Correlation Between Oklahoma Municipal and Loomis Sayles
Can any of the company-specific risk be diversified away by investing in both Oklahoma Municipal and Loomis Sayles 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 Loomis Sayles 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 Loomis Sayles Global, you can compare the effects of market volatilities on Oklahoma Municipal and Loomis Sayles 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 Loomis Sayles. Check out your portfolio center. Please also check ongoing floating volatility patterns of Oklahoma Municipal and Loomis Sayles.
Diversification Opportunities for Oklahoma Municipal and Loomis Sayles
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Oklahoma and Loomis is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding Oklahoma Municipal Fund and Loomis Sayles Global in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Loomis Sayles Global 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 Loomis Sayles. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Loomis Sayles Global has no effect on the direction of Oklahoma Municipal i.e., Oklahoma Municipal and Loomis Sayles go up and down completely randomly.
Pair Corralation between Oklahoma Municipal and Loomis Sayles
Assuming the 90 days horizon Oklahoma Municipal Fund is expected to generate 0.66 times more return on investment than Loomis Sayles. However, Oklahoma Municipal Fund is 1.52 times less risky than Loomis Sayles. It trades about 0.12 of its potential returns per unit of risk. Loomis Sayles Global is currently generating about 0.07 per unit of risk. If you would invest 1,027 in Oklahoma Municipal Fund on September 1, 2024 and sell it today you would earn a total of 39.00 from holding Oklahoma Municipal Fund or generate 3.8% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.21% |
| Values | Daily Returns |
Oklahoma Municipal Fund vs. Loomis Sayles Global
Performance |
| Timeline |
| Oklahoma Municipal |
| Loomis Sayles Global |
Oklahoma Municipal and Loomis Sayles Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Oklahoma Municipal and Loomis Sayles
The main advantage of trading using opposite Oklahoma Municipal and Loomis Sayles positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Oklahoma Municipal position performs unexpectedly, Loomis Sayles 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 Loomis Sayles will offset losses from the drop in Loomis Sayles' long position.| Oklahoma Municipal vs. Mesirow Financial Small | Oklahoma Municipal vs. Transamerica Financial Life | Oklahoma Municipal vs. 1919 Financial Services | Oklahoma Municipal vs. Angel Oak Financial |
| Loomis Sayles vs. Loomis Sayles Inflation | Loomis Sayles vs. Loomis Sayles Inflation | Loomis Sayles vs. Loomis Sayles Bond | Loomis Sayles vs. Loomis Sayles Bond |
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 Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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