Correlation Between Truxton and Oakworth Capital
Can any of the company-specific risk be diversified away by investing in both Truxton and Oakworth Capital 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 Truxton and Oakworth Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Truxton and Oakworth Capital, you can compare the effects of market volatilities on Truxton and Oakworth Capital 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 Truxton with a short position of Oakworth Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Truxton and Oakworth Capital.
Diversification Opportunities for Truxton and Oakworth Capital
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Truxton and Oakworth is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding Truxton and Oakworth Capital in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Oakworth Capital and Truxton 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 Truxton are associated (or correlated) with Oakworth Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Oakworth Capital has no effect on the direction of Truxton i.e., Truxton and Oakworth Capital go up and down completely randomly.
Pair Corralation between Truxton and Oakworth Capital
Given the investment horizon of 90 days Truxton is expected to generate 0.87 times more return on investment than Oakworth Capital. However, Truxton is 1.15 times less risky than Oakworth Capital. It trades about 0.09 of its potential returns per unit of risk. Oakworth Capital is currently generating about 0.05 per unit of risk. If you would invest 6,268 in Truxton on September 1, 2024 and sell it today you would earn a total of 1,047 from holding Truxton or generate 16.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.21% |
| Values | Daily Returns |
Truxton vs. Oakworth Capital
Performance |
| Timeline |
| Truxton |
| Oakworth Capital |
Truxton and Oakworth Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Truxton and Oakworth Capital
The main advantage of trading using opposite Truxton and Oakworth Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Truxton position performs unexpectedly, Oakworth Capital 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 Oakworth Capital will offset losses from the drop in Oakworth Capital's long position.| Truxton vs. Piraeus Bank SA | Truxton vs. Turkiye Garanti Bankasi | Truxton vs. Delhi Bank Corp | Truxton vs. Uwharrie Capital Corp |
| Oakworth Capital vs. KeyCorp | Oakworth Capital vs. FinecoBank Banca Fineco | Oakworth Capital vs. AMMB Holdings Berhad | Oakworth Capital vs. Triumph Financial |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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