Correlation Between Oracle and Easterly Government
Can any of the company-specific risk be diversified away by investing in both Oracle and Easterly Government 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 Oracle and Easterly Government into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Oracle and Easterly Government Properties, you can compare the effects of market volatilities on Oracle and Easterly Government 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 Oracle with a short position of Easterly Government. Check out your portfolio center. Please also check ongoing floating volatility patterns of Oracle and Easterly Government.
Diversification Opportunities for Oracle and Easterly Government
-0.24 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Oracle and Easterly is -0.24. Overlapping area represents the amount of risk that can be diversified away by holding Oracle and Easterly Government Properties in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Easterly Government and Oracle 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 Oracle are associated (or correlated) with Easterly Government. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Easterly Government has no effect on the direction of Oracle i.e., Oracle and Easterly Government go up and down completely randomly.
Pair Corralation between Oracle and Easterly Government
Given the investment horizon of 90 days Oracle is expected to generate 1.27 times more return on investment than Easterly Government. However, Oracle is 1.27 times more volatile than Easterly Government Properties. It trades about 0.09 of its potential returns per unit of risk. Easterly Government Properties is currently generating about 0.01 per unit of risk. If you would invest 7,832 in Oracle on September 12, 2024 and sell it today you would earn a total of 9,942 from holding Oracle or generate 126.94% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 98.21% |
| Values | Daily Returns |
Oracle vs. Easterly Government Properties
Performance |
| Timeline |
| Oracle |
| Easterly Government |
Oracle and Easterly Government Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Oracle and Easterly Government
The main advantage of trading using opposite Oracle and Easterly Government positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Oracle position performs unexpectedly, Easterly Government 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 Easterly Government will offset losses from the drop in Easterly Government's long position.| Oracle vs. Palo Alto Networks | Oracle vs. Crowdstrike Holdings | Oracle vs. Microsoft | Oracle vs. Block Inc |
| Easterly Government vs. Office Properties Income | Easterly Government vs. CITY OFFICE REIT | Easterly Government vs. CREMECOMTRSBI DL 001 | Easterly Government vs. Superior Plus Corp |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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