Correlation Between Vanguard Value and Natixis Oakmark
Can any of the company-specific risk be diversified away by investing in both Vanguard Value and Natixis Oakmark 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 Vanguard Value and Natixis Oakmark into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Vanguard Value Index and Natixis Oakmark Fund, you can compare the effects of market volatilities on Vanguard Value and Natixis Oakmark 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 Vanguard Value with a short position of Natixis Oakmark. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vanguard Value and Natixis Oakmark.
Diversification Opportunities for Vanguard Value and Natixis Oakmark
0.92 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Vanguard and Natixis is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding Vanguard Value Index and Natixis Oakmark Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Natixis Oakmark and Vanguard Value 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 Vanguard Value Index are associated (or correlated) with Natixis Oakmark. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Natixis Oakmark has no effect on the direction of Vanguard Value i.e., Vanguard Value and Natixis Oakmark go up and down completely randomly.
Pair Corralation between Vanguard Value and Natixis Oakmark
Assuming the 90 days horizon Vanguard Value Index is expected to generate 0.78 times more return on investment than Natixis Oakmark. However, Vanguard Value Index is 1.28 times less risky than Natixis Oakmark. It trades about 0.15 of its potential returns per unit of risk. Natixis Oakmark Fund is currently generating about 0.11 per unit of risk. If you would invest 6,125 in Vanguard Value Index on September 3, 2024 and sell it today you would earn a total of 964.00 from holding Vanguard Value Index or generate 15.74% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Vanguard Value Index vs. Natixis Oakmark Fund
Performance |
| Timeline |
| Vanguard Value Index |
| Natixis Oakmark |
Vanguard Value and Natixis Oakmark Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Vanguard Value and Natixis Oakmark
The main advantage of trading using opposite Vanguard Value and Natixis Oakmark positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Vanguard Value position performs unexpectedly, Natixis Oakmark 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 Natixis Oakmark will offset losses from the drop in Natixis Oakmark's long position.| Vanguard Value vs. Dodge Cox Stock | Vanguard Value vs. American Funds American | Vanguard Value vs. American Funds American | Vanguard Value vs. American Mutual Fund |
| Natixis Oakmark vs. Vanguard Value Index | Natixis Oakmark vs. Dodge Cox Stock | Natixis Oakmark vs. American Funds American | Natixis Oakmark vs. American Funds American |
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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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