Correlation Between Western Asset and Oppenheimer Senior
Can any of the company-specific risk be diversified away by investing in both Western Asset 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 Western Asset and Oppenheimer Senior into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Western Asset Diversified and Oppenheimer Senior Floating, you can compare the effects of market volatilities on Western Asset 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 Western Asset with a short position of Oppenheimer Senior. Check out your portfolio center. Please also check ongoing floating volatility patterns of Western Asset and Oppenheimer Senior.
Diversification Opportunities for Western Asset and Oppenheimer Senior
-0.61 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Western and Oppenheimer is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding Western Asset Diversified and Oppenheimer Senior Floating in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Oppenheimer Senior and Western Asset 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 Western Asset Diversified 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 Western Asset i.e., Western Asset and Oppenheimer Senior go up and down completely randomly.
Pair Corralation between Western Asset and Oppenheimer Senior
Assuming the 90 days horizon Western Asset Diversified is expected to under-perform the Oppenheimer Senior. In addition to that, Western Asset is 1.47 times more volatile than Oppenheimer Senior Floating. It trades about -0.02 of its total potential returns per unit of risk. Oppenheimer Senior Floating is currently generating about 0.17 per unit of volatility. If you would invest 636.00 in Oppenheimer Senior Floating on September 12, 2024 and sell it today you would earn a total of 25.00 from holding Oppenheimer Senior Floating or generate 3.93% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 99.2% |
| Values | Daily Returns |
Western Asset Diversified vs. Oppenheimer Senior Floating
Performance |
| Timeline |
| Western Asset Diversified |
| Oppenheimer Senior |
Western Asset and Oppenheimer Senior Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Western Asset and Oppenheimer Senior
The main advantage of trading using opposite Western Asset and Oppenheimer Senior positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Western Asset 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.| Western Asset vs. Vanguard Total Stock | Western Asset vs. Vanguard 500 Index | Western Asset vs. Vanguard Total Stock | Western Asset vs. Vanguard Total Stock |
| 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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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