Correlation Between Oppenheimer Gold and Capital World
Can any of the company-specific risk be diversified away by investing in both Oppenheimer Gold and Capital World 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 Oppenheimer Gold and Capital World into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Oppenheimer Gold Special and Capital World Bond, you can compare the effects of market volatilities on Oppenheimer Gold and Capital World 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 Oppenheimer Gold with a short position of Capital World. Check out your portfolio center. Please also check ongoing floating volatility patterns of Oppenheimer Gold and Capital World.
Diversification Opportunities for Oppenheimer Gold and Capital World
-0.08 | Correlation Coefficient |
Good diversification
The 3 months correlation between Oppenheimer and Capital is -0.08. Overlapping area represents the amount of risk that can be diversified away by holding Oppenheimer Gold Special and Capital World Bond in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Capital World Bond and Oppenheimer Gold 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 Oppenheimer Gold Special are associated (or correlated) with Capital World. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Capital World Bond has no effect on the direction of Oppenheimer Gold i.e., Oppenheimer Gold and Capital World go up and down completely randomly.
Pair Corralation between Oppenheimer Gold and Capital World
Assuming the 90 days horizon Oppenheimer Gold Special is expected to under-perform the Capital World. In addition to that, Oppenheimer Gold is 4.92 times more volatile than Capital World Bond. It trades about -0.18 of its total potential returns per unit of risk. Capital World Bond is currently generating about -0.1 per unit of volatility. If you would invest 1,608 in Capital World Bond on August 28, 2024 and sell it today you would lose (14.00) from holding Capital World Bond or give up 0.87% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Oppenheimer Gold Special vs. Capital World Bond
Performance |
| Timeline |
| Oppenheimer Gold Special |
| Capital World Bond |
Oppenheimer Gold and Capital World Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Oppenheimer Gold and Capital World
The main advantage of trading using opposite Oppenheimer Gold and Capital World positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Oppenheimer Gold position performs unexpectedly, Capital World 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 Capital World will offset losses from the drop in Capital World's long position.| Oppenheimer Gold vs. Invesco Municipal Income | Oppenheimer Gold vs. Invesco Municipal Income | Oppenheimer Gold vs. Invesco Municipal Income | Oppenheimer Gold vs. Oppenheimer Rising Dividends |
| Capital World vs. International Investors Gold | Capital World vs. Fidelity Advisor Gold | Capital World vs. Great West Goldman Sachs | Capital World vs. Oppenheimer Gold Special |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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