Correlation Between Angel Oak and Small Company
Can any of the company-specific risk be diversified away by investing in both Angel Oak and Small Company 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 Small Company 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 Small Pany Value, you can compare the effects of market volatilities on Angel Oak and Small Company 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 Small Company. Check out your portfolio center. Please also check ongoing floating volatility patterns of Angel Oak and Small Company.
Diversification Opportunities for Angel Oak and Small Company
-0.69 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Angel and Small is -0.69. Overlapping area represents the amount of risk that can be diversified away by holding Angel Oak Multi Strategy and Small Pany Value in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Small Pany Value 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 Small Company. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Small Pany Value has no effect on the direction of Angel Oak i.e., Angel Oak and Small Company go up and down completely randomly.
Pair Corralation between Angel Oak and Small Company
Assuming the 90 days horizon Angel Oak Multi Strategy is expected to generate 0.17 times more return on investment than Small Company. However, Angel Oak Multi Strategy is 5.85 times less risky than Small Company. It trades about 0.17 of its potential returns per unit of risk. Small Pany Value is currently generating about -0.09 per unit of risk. If you would invest 843.00 in Angel Oak Multi Strategy on December 27, 2024 and sell it today you would earn a total of 16.00 from holding Angel Oak Multi Strategy or generate 1.9% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Weak |
Accuracy | 98.36% |
Values | Daily Returns |
Angel Oak Multi Strategy vs. Small Pany Value
Performance |
Timeline |
Angel Oak Multi |
Small Pany Value |
Angel Oak and Small Company Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Angel Oak and Small Company
The main advantage of trading using opposite Angel Oak and Small Company positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Angel Oak position performs unexpectedly, Small Company 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 Small Company will offset losses from the drop in Small Company's long position.Angel Oak vs. Sa Emerging Markets | Angel Oak vs. Fidelity Series Emerging | Angel Oak vs. Prudential Emerging Markets | Angel Oak vs. Catalystmillburn Hedge Strategy |
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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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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