Correlation Between Oklahoma Municipal and Cullen Value
Can any of the company-specific risk be diversified away by investing in both Oklahoma Municipal and Cullen Value 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 Oklahoma Municipal and Cullen Value into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Oklahoma Municipal Fund and Cullen Value Fund, you can compare the effects of market volatilities on Oklahoma Municipal and Cullen Value 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 Oklahoma Municipal with a short position of Cullen Value. Check out your portfolio center. Please also check ongoing floating volatility patterns of Oklahoma Municipal and Cullen Value.
Diversification Opportunities for Oklahoma Municipal and Cullen Value
-0.28 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Oklahoma and CULLEN is -0.28. Overlapping area represents the amount of risk that can be diversified away by holding Oklahoma Municipal Fund and Cullen Value Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cullen Value and Oklahoma Municipal 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 Oklahoma Municipal Fund are associated (or correlated) with Cullen Value. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cullen Value has no effect on the direction of Oklahoma Municipal i.e., Oklahoma Municipal and Cullen Value go up and down completely randomly.
Pair Corralation between Oklahoma Municipal and Cullen Value
Assuming the 90 days horizon Oklahoma Municipal is expected to generate 1.97 times less return on investment than Cullen Value. But when comparing it to its historical volatility, Oklahoma Municipal Fund is 2.35 times less risky than Cullen Value. It trades about 0.25 of its potential returns per unit of risk. Cullen Value Fund is currently generating about 0.21 of returns per unit of risk over similar time horizon. If you would invest 1,424 in Cullen Value Fund on August 30, 2024 and sell it today you would earn a total of 51.00 from holding Cullen Value Fund or generate 3.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Oklahoma Municipal Fund vs. Cullen Value Fund
Performance |
| Timeline |
| Oklahoma Municipal |
| Cullen Value |
Oklahoma Municipal and Cullen Value Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Oklahoma Municipal and Cullen Value
The main advantage of trading using opposite Oklahoma Municipal and Cullen Value positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Oklahoma Municipal position performs unexpectedly, Cullen Value 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 Cullen Value will offset losses from the drop in Cullen Value's long position.| Oklahoma Municipal vs. Western Asset Municipal | Oklahoma Municipal vs. Intermediate Term Bond Fund | Oklahoma Municipal vs. Multisector Bond Sma | Oklahoma Municipal vs. Legg Mason Bw |
| Cullen Value vs. Nuveen Massachusetts Municipal | Cullen Value vs. Barings Active Short | Cullen Value vs. Ab Impact Municipal | Cullen Value vs. Nebraska Municipal Fund |
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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
Other Complementary Tools
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| Stocks Directory Find actively traded stocks across global markets |