Correlation Between Investec Emerging and Oakmark Global
Can any of the company-specific risk be diversified away by investing in both Investec Emerging and Oakmark Global 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 Investec Emerging and Oakmark Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Investec Emerging Markets and Oakmark Global Select, you can compare the effects of market volatilities on Investec Emerging and Oakmark Global 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 Investec Emerging with a short position of Oakmark Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Investec Emerging and Oakmark Global.
Diversification Opportunities for Investec Emerging and Oakmark Global
0.84 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Investec and Oakmark is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding Investec Emerging Markets and Oakmark Global Select in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Oakmark Global Select and Investec Emerging 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 Investec Emerging Markets are associated (or correlated) with Oakmark Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Oakmark Global Select has no effect on the direction of Investec Emerging i.e., Investec Emerging and Oakmark Global go up and down completely randomly.
Pair Corralation between Investec Emerging and Oakmark Global
Assuming the 90 days horizon Investec Emerging Markets is expected to generate 1.39 times more return on investment than Oakmark Global. However, Investec Emerging is 1.39 times more volatile than Oakmark Global Select. It trades about 0.05 of its potential returns per unit of risk. Oakmark Global Select is currently generating about 0.05 per unit of risk. If you would invest 1,042 in Investec Emerging Markets on September 12, 2024 and sell it today you would earn a total of 30.00 from holding Investec Emerging Markets or generate 2.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 98.44% |
| Values | Daily Returns |
Investec Emerging Markets vs. Oakmark Global Select
Performance |
| Timeline |
| Investec Emerging Markets |
| Oakmark Global Select |
Investec Emerging and Oakmark Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Investec Emerging and Oakmark Global
The main advantage of trading using opposite Investec Emerging and Oakmark Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Investec Emerging position performs unexpectedly, Oakmark Global 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 Oakmark Global will offset losses from the drop in Oakmark Global's long position.| Investec Emerging vs. Origin Emerging Markets | Investec Emerging vs. Franklin Emerging Market | Investec Emerging vs. Barings Emerging Markets | Investec Emerging vs. Shelton Emerging Markets |
| Oakmark Global vs. Locorr Market Trend | Oakmark Global vs. Investec Emerging Markets | Oakmark Global vs. Calvert Developed Market | Oakmark Global vs. Barings Emerging Markets |
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 Dashboard module to portfolio dashboard that provides centralized access to all your investments.
Other Complementary Tools
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments |