Correlation Between Oracle and Herman Miller
Can any of the company-specific risk be diversified away by investing in both Oracle and Herman Miller 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 Herman Miller into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Oracle and Herman Miller, you can compare the effects of market volatilities on Oracle and Herman Miller 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 Herman Miller. Check out your portfolio center. Please also check ongoing floating volatility patterns of Oracle and Herman Miller.
Diversification Opportunities for Oracle and Herman Miller
-0.53 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Oracle and Herman is -0.53. Overlapping area represents the amount of risk that can be diversified away by holding Oracle and Herman Miller in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Herman Miller 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 Herman Miller. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Herman Miller has no effect on the direction of Oracle i.e., Oracle and Herman Miller go up and down completely randomly.
Pair Corralation between Oracle and Herman Miller
Given the investment horizon of 90 days Oracle is expected to generate 0.92 times more return on investment than Herman Miller. However, Oracle is 1.09 times less risky than Herman Miller. It trades about 0.16 of its potential returns per unit of risk. Herman Miller is currently generating about 0.01 per unit of risk. If you would invest 11,774 in Oracle on September 3, 2024 and sell it today you would earn a total of 6,710 from holding Oracle or generate 56.99% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 96.69% |
| Values | Daily Returns |
Oracle vs. Herman Miller
Performance |
| Timeline |
| Oracle |
| Herman Miller |
Oracle and Herman Miller Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Oracle and Herman Miller
The main advantage of trading using opposite Oracle and Herman Miller positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Oracle position performs unexpectedly, Herman Miller 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 Herman Miller will offset losses from the drop in Herman Miller's long position.| Oracle vs. Palo Alto Networks | Oracle vs. Crowdstrike Holdings | Oracle vs. Microsoft | Oracle vs. Block Inc |
| Herman Miller vs. SERI INDUSTRIAL EO | Herman Miller vs. Meiko Electronics Co | Herman Miller vs. GALENA MINING LTD | Herman Miller vs. Zijin Mining Group |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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