Correlation Between Oakley Capital and Markel Corp
Can any of the company-specific risk be diversified away by investing in both Oakley Capital and Markel Corp at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Oakley Capital and Markel Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Oakley Capital Investments and Markel Corp, you can compare the effects of market volatilities on Oakley Capital and Markel Corp and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Oakley Capital with a short position of Markel Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Oakley Capital and Markel Corp.
Diversification Opportunities for Oakley Capital and Markel Corp
-0.6 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Oakley and Markel is -0.6. Overlapping area represents the amount of risk that can be diversified away by holding Oakley Capital Investments and Markel Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Markel Corp and Oakley Capital is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Oakley Capital Investments are associated (or correlated) with Markel Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Markel Corp has no effect on the direction of Oakley Capital i.e., Oakley Capital and Markel Corp go up and down completely randomly.
Pair Corralation between Oakley Capital and Markel Corp
Assuming the 90 days trading horizon Oakley Capital is expected to generate 1.96 times less return on investment than Markel Corp. But when comparing it to its historical volatility, Oakley Capital Investments is 1.19 times less risky than Markel Corp. It trades about 0.03 of its potential returns per unit of risk. Markel Corp is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 127,736 in Markel Corp on September 2, 2024 and sell it today you would earn a total of 50,910 from holding Markel Corp or generate 39.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 97.6% |
| Values | Daily Returns |
Oakley Capital Investments vs. Markel Corp
Performance |
| Timeline |
| Oakley Capital Inves |
| Markel Corp |
Oakley Capital and Markel Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Oakley Capital and Markel Corp
The main advantage of trading using opposite Oakley Capital and Markel Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Oakley Capital position performs unexpectedly, Markel Corp can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Markel Corp will offset losses from the drop in Markel Corp's long position.| Oakley Capital vs. Toyota Motor Corp | Oakley Capital vs. SoftBank Group Corp | Oakley Capital vs. OTP Bank Nyrt | Oakley Capital vs. Las Vegas Sands |
| Markel Corp vs. Jacquet Metal Service | Markel Corp vs. Tatton Asset Management | Markel Corp vs. Global Net Lease | Markel Corp vs. Blackstone Loan Financing |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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