Correlation Between Red Oak and Ashmore Emerging
Can any of the company-specific risk be diversified away by investing in both Red Oak and Ashmore Emerging 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 Red Oak and Ashmore Emerging into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Red Oak Technology and Ashmore Emerging Markets, you can compare the effects of market volatilities on Red Oak and Ashmore Emerging 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 Red Oak with a short position of Ashmore Emerging. Check out your portfolio center. Please also check ongoing floating volatility patterns of Red Oak and Ashmore Emerging.
Diversification Opportunities for Red Oak and Ashmore Emerging
0.77 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Red and Ashmore is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding Red Oak Technology and Ashmore Emerging Markets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ashmore Emerging Markets and Red 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 Red Oak Technology are associated (or correlated) with Ashmore Emerging. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ashmore Emerging Markets has no effect on the direction of Red Oak i.e., Red Oak and Ashmore Emerging go up and down completely randomly.
Pair Corralation between Red Oak and Ashmore Emerging
Assuming the 90 days horizon Red Oak Technology is expected to generate 1.46 times more return on investment than Ashmore Emerging. However, Red Oak is 1.46 times more volatile than Ashmore Emerging Markets. It trades about 0.2 of its potential returns per unit of risk. Ashmore Emerging Markets is currently generating about 0.26 per unit of risk. If you would invest 4,873 in Red Oak Technology on June 6, 2025 and sell it today you would earn a total of 552.00 from holding Red Oak Technology or generate 11.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Red Oak Technology vs. Ashmore Emerging Markets
Performance |
| Timeline |
| Red Oak Technology |
| Ashmore Emerging Markets |
Red Oak and Ashmore Emerging Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Red Oak and Ashmore Emerging
The main advantage of trading using opposite Red Oak and Ashmore Emerging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Red Oak position performs unexpectedly, Ashmore Emerging 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 Ashmore Emerging will offset losses from the drop in Ashmore Emerging's long position.| Red Oak vs. White Oak Select | Red Oak vs. Black Oak Emerging | Red Oak vs. Berkshire Focus | Red Oak vs. Janus Global Technology |
| Ashmore Emerging vs. Doubleline Core Fixed | Ashmore Emerging vs. Enhanced Fixed Income | Ashmore Emerging vs. Gmo Global Equity | Ashmore Emerging vs. T Rowe Price |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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