Correlation Between Angel Oak and Praxis Small
Can any of the company-specific risk be diversified away by investing in both Angel Oak and Praxis Small 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 Angel Oak and Praxis Small into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Angel Oak Multi Strategy and Praxis Small Cap, you can compare the effects of market volatilities on Angel Oak and Praxis Small 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 Angel Oak with a short position of Praxis Small. Check out your portfolio center. Please also check ongoing floating volatility patterns of Angel Oak and Praxis Small.
Diversification Opportunities for Angel Oak and Praxis Small
-0.33 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Angel and Praxis is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding Angel Oak Multi Strategy and Praxis Small Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Praxis Small Cap and Angel 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 Angel Oak Multi Strategy are associated (or correlated) with Praxis Small. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Praxis Small Cap has no effect on the direction of Angel Oak i.e., Angel Oak and Praxis Small go up and down completely randomly.
Pair Corralation between Angel Oak and Praxis Small
Assuming the 90 days horizon Angel Oak Multi Strategy is expected to generate 0.11 times more return on investment than Praxis Small. However, Angel Oak Multi Strategy is 9.36 times less risky than Praxis Small. It trades about -0.1 of its potential returns per unit of risk. Praxis Small Cap is currently generating about -0.33 per unit of risk. If you would invest 856.00 in Angel Oak Multi Strategy on September 25, 2024 and sell it today you would lose (2.00) from holding Angel Oak Multi Strategy or give up 0.23% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 95.24% |
Values | Daily Returns |
Angel Oak Multi Strategy vs. Praxis Small Cap
Performance |
Timeline |
Angel Oak Multi |
Praxis Small Cap |
Angel Oak and Praxis Small Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Angel Oak and Praxis Small
The main advantage of trading using opposite Angel Oak and Praxis Small positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Angel Oak position performs unexpectedly, Praxis Small 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 Praxis Small will offset losses from the drop in Praxis Small's long position.Angel Oak vs. Angel Oak Multi Strategy | Angel Oak vs. Angel Oak Multi Strategy | Angel Oak vs. Doubleline Income Solutions | Angel Oak vs. Angel Oak Ultrashort |
Praxis Small vs. Angel Oak Multi Strategy | Praxis Small vs. Vy Jpmorgan Emerging | Praxis Small vs. Origin Emerging Markets | Praxis Small vs. Mid Cap 15x Strategy |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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