Correlation Between Live Oak and Aberdeen Japan
Can any of the company-specific risk be diversified away by investing in both Live Oak and Aberdeen Japan 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 Live Oak and Aberdeen Japan into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Live Oak Health and Aberdeen Japan Equity, you can compare the effects of market volatilities on Live Oak and Aberdeen Japan 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 Live Oak with a short position of Aberdeen Japan. Check out your portfolio center. Please also check ongoing floating volatility patterns of Live Oak and Aberdeen Japan.
Diversification Opportunities for Live Oak and Aberdeen Japan
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Live and Aberdeen is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Live Oak Health and Aberdeen Japan Equity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aberdeen Japan Equity and Live Oak 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 Live Oak Health are associated (or correlated) with Aberdeen Japan. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aberdeen Japan Equity has no effect on the direction of Live Oak i.e., Live Oak and Aberdeen Japan go up and down completely randomly.
Pair Corralation between Live Oak and Aberdeen Japan
Assuming the 90 days horizon Live Oak is expected to generate 1.15 times less return on investment than Aberdeen Japan. But when comparing it to its historical volatility, Live Oak Health is 1.86 times less risky than Aberdeen Japan. It trades about 0.26 of its potential returns per unit of risk. Aberdeen Japan Equity is currently generating about 0.16 of returns per unit of risk over similar time horizon. If you would invest 739.00 in Aberdeen Japan Equity on September 4, 2025 and sell it today you would earn a total of 54.00 from holding Aberdeen Japan Equity or generate 7.31% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 47.62% |
| Values | Daily Returns |
Live Oak Health vs. Aberdeen Japan Equity
Performance |
| Timeline |
| Live Oak Health |
| Aberdeen Japan Equity |
Risk-Adjusted Performance
Good
Weak | Strong |
Live Oak and Aberdeen Japan Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Live Oak and Aberdeen Japan
The main advantage of trading using opposite Live Oak and Aberdeen Japan positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Live Oak position performs unexpectedly, Aberdeen Japan 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 Aberdeen Japan will offset losses from the drop in Aberdeen Japan's long position.| Live Oak vs. Blackrock Government Bond | Live Oak vs. Wells Fargo Government | Live Oak vs. Us Government Securities | Live Oak vs. Short Term Government Fund |
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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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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