Correlation Between Pin Oak and Paradigm Micro

Can any of the company-specific risk be diversified away by investing in both Pin Oak and Paradigm Micro 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 Pin Oak and Paradigm Micro into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Pin Oak Equity and Paradigm Micro Cap Fund, you can compare the effects of market volatilities on Pin Oak and Paradigm Micro 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 Pin Oak with a short position of Paradigm Micro. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pin Oak and Paradigm Micro.

Diversification Opportunities for Pin Oak and Paradigm Micro

-0.26

Correlation Coefficient

Pin Oak  Paradigm Micro

Very good diversification

The 3 months correlation between Pin and Paradigm is -0.26. Overlapping area represents the amount of risk that can be diversified away by holding Pin Oak Equity and Paradigm Micro Cap Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Paradigm Micro Cap and Pin 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 Pin Oak Equity are associated (or correlated) with Paradigm Micro. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Paradigm Micro Cap has no effect on the direction of Pin Oak i.e., Pin Oak and Paradigm Micro go up and down completely randomly.

Pair Corralation between Pin Oak and Paradigm Micro

Assuming the 90 days horizon Pin Oak Equity is expected to generate 0.46 times more return on investment than Paradigm Micro. However, Pin Oak Equity is 2.16 times less risky than Paradigm Micro. It trades about 0.15 of its potential returns per unit of risk. Paradigm Micro Cap Fund is currently generating about -0.01 per unit of risk. If you would invest  8,915  in Pin Oak Equity on August 26, 2025 and sell it today you would earn a total of  639.00  from holding Pin Oak Equity or generate 7.17% return on investment over 90 days.

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

Pin Oak Equity  vs.  Paradigm Micro Cap Fund

Pin Oak Equity

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Pin Oak Equity are ranked lower than 11 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak basic indicators, Pin Oak may actually be approaching a critical reversion point that can send shares even higher in December 2025.

Paradigm Micro Cap

Risk-Adjusted Performance

Weakest

Over the last 90 days Paradigm Micro Cap Fund has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong basic indicators, Paradigm Micro is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Pin Oak and Paradigm Micro

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

The idea behind Pin Oak Equity and Paradigm Micro Cap Fund 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 Bonds Directory module to find actively traded corporate debentures issued by US companies.