Correlation Between Oppenheimer Rochester and Lord Abbett
Can any of the company-specific risk be diversified away by investing in both Oppenheimer Rochester and Lord Abbett 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 Oppenheimer Rochester and Lord Abbett into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Oppenheimer Rochester High and Lord Abbett High, you can compare the effects of market volatilities on Oppenheimer Rochester and Lord Abbett 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 Oppenheimer Rochester with a short position of Lord Abbett. Check out your portfolio center. Please also check ongoing floating volatility patterns of Oppenheimer Rochester and Lord Abbett.
Diversification Opportunities for Oppenheimer Rochester and Lord Abbett
0.4 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Oppenheimer and Lord is 0.4. Overlapping area represents the amount of risk that can be diversified away by holding Oppenheimer Rochester High and Lord Abbett High in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lord Abbett High and Oppenheimer Rochester 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 Oppenheimer Rochester High are associated (or correlated) with Lord Abbett. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lord Abbett High has no effect on the direction of Oppenheimer Rochester i.e., Oppenheimer Rochester and Lord Abbett go up and down completely randomly.
Pair Corralation between Oppenheimer Rochester and Lord Abbett
Assuming the 90 days horizon Oppenheimer Rochester High is expected to generate 2.62 times more return on investment than Lord Abbett. However, Oppenheimer Rochester is 2.62 times more volatile than Lord Abbett High. It trades about 0.16 of its potential returns per unit of risk. Lord Abbett High is currently generating about 0.15 per unit of risk. If you would invest 689.00 in Oppenheimer Rochester High on September 4, 2024 and sell it today you would earn a total of 9.00 from holding Oppenheimer Rochester High or generate 1.31% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Oppenheimer Rochester High vs. Lord Abbett High
Performance |
| Timeline |
| Oppenheimer Rochester |
| Lord Abbett High |
Oppenheimer Rochester and Lord Abbett Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Oppenheimer Rochester and Lord Abbett
The main advantage of trading using opposite Oppenheimer Rochester and Lord Abbett positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Oppenheimer Rochester position performs unexpectedly, Lord Abbett 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 Lord Abbett will offset losses from the drop in Lord Abbett's long position.| Oppenheimer Rochester vs. Lord Abbett High | Oppenheimer Rochester vs. Pgim High Yield | Oppenheimer Rochester vs. American Century High | Oppenheimer Rochester vs. Artisan High Income |
| Lord Abbett vs. Clearbridge Energy Mlp | Lord Abbett vs. World Energy Fund | Lord Abbett vs. Hennessy Bp Energy | Lord Abbett vs. Oil Gas Ultrasector |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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