Correlation Between College Retirement and Oppenheimer International

Can any of the company-specific risk be diversified away by investing in both College Retirement and Oppenheimer International 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 College Retirement and Oppenheimer International into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between College Retirement Equities and Oppenheimer International Small, you can compare the effects of market volatilities on College Retirement and Oppenheimer International 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 College Retirement with a short position of Oppenheimer International. Check out your portfolio center. Please also check ongoing floating volatility patterns of College Retirement and Oppenheimer International.

Diversification Opportunities for College Retirement and Oppenheimer International

-0.71

Correlation Coefficient

College Retirement  Oppenheimer International

Pay attention - limited upside

The 3 months correlation between College and Oppenheimer is -0.71. Overlapping area represents the amount of risk that can be diversified away by holding College Retirement Equities and Oppenheimer International Smal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Oppenheimer International and College Retirement 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 College Retirement Equities are associated (or correlated) with Oppenheimer International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Oppenheimer International has no effect on the direction of College Retirement i.e., College Retirement and Oppenheimer International go up and down completely randomly.

Pair Corralation between College Retirement and Oppenheimer International

Assuming the 90 days trading horizon College Retirement Equities is expected to generate 0.18 times more return on investment than Oppenheimer International. However, College Retirement Equities is 5.43 times less risky than Oppenheimer International. It trades about 0.32 of its potential returns per unit of risk. Oppenheimer International Small is currently generating about -0.16 per unit of risk. If you would invest  50,632  in College Retirement Equities on September 18, 2024 and sell it today you would earn a total of  1,435  from holding College Retirement Equities or generate 2.83% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

College Retirement Equities  vs.  Oppenheimer International Smal

College Retirement

Risk-Adjusted Performance

14 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in College Retirement Equities are ranked lower than 14 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak technical and fundamental indicators, College Retirement may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Oppenheimer International

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Oppenheimer International Small has generated negative risk-adjusted returns adding no value to fund investors. In spite of weak performance in the last few months, the Fund's basic indicators remain fairly strong which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long term up-swing for the fund investors.

Pair Trading with College Retirement and Oppenheimer International

The main advantage of trading using opposite College Retirement and Oppenheimer International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if College Retirement position performs unexpectedly, Oppenheimer International 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 International will offset losses from the drop in Oppenheimer International's long position.

The idea behind College Retirement Equities and Oppenheimer International Small pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.