Correlation Between Oxford Technology and Liontrust Asset
Can any of the company-specific risk be diversified away by investing in both Oxford Technology and Liontrust Asset 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 Oxford Technology and Liontrust Asset into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Oxford Technology 2 and Liontrust Asset Management, you can compare the effects of market volatilities on Oxford Technology and Liontrust Asset 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 Oxford Technology with a short position of Liontrust Asset. Check out your portfolio center. Please also check ongoing floating volatility patterns of Oxford Technology and Liontrust Asset.
Diversification Opportunities for Oxford Technology and Liontrust Asset
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Oxford and Liontrust is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Oxford Technology 2 and Liontrust Asset Management in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Liontrust Asset Mana and Oxford Technology 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 Oxford Technology 2 are associated (or correlated) with Liontrust Asset. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Liontrust Asset Mana has no effect on the direction of Oxford Technology i.e., Oxford Technology and Liontrust Asset go up and down completely randomly.
Pair Corralation between Oxford Technology and Liontrust Asset
Assuming the 90 days trading horizon Oxford Technology 2 is expected to under-perform the Liontrust Asset. In addition to that, Oxford Technology is 1.06 times more volatile than Liontrust Asset Management. It trades about -0.26 of its total potential returns per unit of risk. Liontrust Asset Management is currently generating about -0.16 per unit of volatility. If you would invest 58,203 in Liontrust Asset Management on September 4, 2024 and sell it today you would lose (14,053) from holding Liontrust Asset Management or give up 24.14% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 98.46% |
| Values | Daily Returns |
Oxford Technology 2 vs. Liontrust Asset Management
Performance |
| Timeline |
| Oxford Technology |
| Liontrust Asset Mana |
Oxford Technology and Liontrust Asset Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Oxford Technology and Liontrust Asset
The main advantage of trading using opposite Oxford Technology and Liontrust Asset positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Oxford Technology position performs unexpectedly, Liontrust Asset 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 Liontrust Asset will offset losses from the drop in Liontrust Asset's long position.| Oxford Technology vs. Liontrust Asset Management | Oxford Technology vs. Scandinavian Tobacco Group | Oxford Technology vs. Impax Asset Management | Oxford Technology vs. STMicroelectronics NV |
| Liontrust Asset vs. SupplyMe Capital PLC | Liontrust Asset vs. Lloyds Banking Group | Liontrust Asset vs. Premier African Minerals | Liontrust Asset vs. SANTANDER UK 8 |
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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