Correlation Between Touchstone Small and Oppenheimer Senior
Can any of the company-specific risk be diversified away by investing in both Touchstone Small and Oppenheimer Senior 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 Touchstone Small and Oppenheimer Senior into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Touchstone Small Cap and Oppenheimer Senior Floating, you can compare the effects of market volatilities on Touchstone Small and Oppenheimer Senior 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 Touchstone Small with a short position of Oppenheimer Senior. Check out your portfolio center. Please also check ongoing floating volatility patterns of Touchstone Small and Oppenheimer Senior.
Diversification Opportunities for Touchstone Small and Oppenheimer Senior
0.8 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Touchstone and Oppenheimer is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding Touchstone Small Cap and Oppenheimer Senior Floating in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Oppenheimer Senior and Touchstone Small 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 Touchstone Small Cap are associated (or correlated) with Oppenheimer Senior. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Oppenheimer Senior has no effect on the direction of Touchstone Small i.e., Touchstone Small and Oppenheimer Senior go up and down completely randomly.
Pair Corralation between Touchstone Small and Oppenheimer Senior
Assuming the 90 days horizon Touchstone Small Cap is expected to under-perform the Oppenheimer Senior. In addition to that, Touchstone Small is 4.18 times more volatile than Oppenheimer Senior Floating. It trades about -0.13 of its total potential returns per unit of risk. Oppenheimer Senior Floating is currently generating about 0.19 per unit of volatility. If you would invest 656.00 in Oppenheimer Senior Floating on September 12, 2024 and sell it today you would earn a total of 5.00 from holding Oppenheimer Senior Floating or generate 0.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 95.45% |
| Values | Daily Returns |
Touchstone Small Cap vs. Oppenheimer Senior Floating
Performance |
| Timeline |
| Touchstone Small Cap |
| Oppenheimer Senior |
Touchstone Small and Oppenheimer Senior Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Touchstone Small and Oppenheimer Senior
The main advantage of trading using opposite Touchstone Small and Oppenheimer Senior positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Touchstone Small position performs unexpectedly, Oppenheimer Senior 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 Oppenheimer Senior will offset losses from the drop in Oppenheimer Senior's long position.| Touchstone Small vs. Smallcap Growth Fund | Touchstone Small vs. Mutual Of America | Touchstone Small vs. Aqr Small Cap | Touchstone Small vs. Scout Small Cap |
| Oppenheimer Senior vs. Small Pany Growth | Oppenheimer Senior vs. Vy Columbia Small | Oppenheimer Senior vs. Cardinal Small Cap | Oppenheimer Senior vs. Touchstone Small Cap |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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