Correlation Between Oracle and Syn Mun
Can any of the company-specific risk be diversified away by investing in both Oracle and Syn Mun 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 Syn Mun into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Oracle and Syn Mun Kong, you can compare the effects of market volatilities on Oracle and Syn Mun 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 Syn Mun. Check out your portfolio center. Please also check ongoing floating volatility patterns of Oracle and Syn Mun.
Diversification Opportunities for Oracle and Syn Mun
Good diversification
The 3 months correlation between Oracle and Syn is -0.17. Overlapping area represents the amount of risk that can be diversified away by holding Oracle and Syn Mun Kong in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Syn Mun Kong 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 Syn Mun. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Syn Mun Kong has no effect on the direction of Oracle i.e., Oracle and Syn Mun go up and down completely randomly.
Pair Corralation between Oracle and Syn Mun
Given the investment horizon of 90 days Oracle is expected to generate 0.04 times more return on investment than Syn Mun. However, Oracle is 25.98 times less risky than Syn Mun. It trades about 0.25 of its potential returns per unit of risk. Syn Mun Kong is currently generating about -0.23 per unit of risk. If you would invest 16,959 in Oracle on September 5, 2024 and sell it today you would earn a total of 1,860 from holding Oracle or generate 10.97% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 22.73% |
| Values | Daily Returns |
Oracle vs. Syn Mun Kong
Performance |
| Timeline |
| Oracle |
| Syn Mun Kong |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
OK
Oracle and Syn Mun Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Oracle and Syn Mun
The main advantage of trading using opposite Oracle and Syn Mun positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Oracle position performs unexpectedly, Syn Mun 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 Syn Mun will offset losses from the drop in Syn Mun's long position.| Oracle vs. Palo Alto Networks | Oracle vs. Crowdstrike Holdings | Oracle vs. Microsoft | Oracle vs. Block Inc |
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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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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