Correlation Between DSJA and Angel Oak

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

By analyzing existing cross correlation between DSJA and Angel Oak Mortgage Backed, you can compare the effects of market volatilities on DSJA and Angel Oak 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 DSJA with a short position of Angel Oak. Check out your portfolio center. Please also check ongoing floating volatility patterns of DSJA and Angel Oak.

Diversification Opportunities for DSJA and Angel Oak

0.0

Correlation Coefficient

DSJA  Angel Oak

Pay attention - limited upside

The 3 months correlation between DSJA and Angel is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding DSJA and Angel Oak Mortgage Backed in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Angel Oak Mortgage and DSJA 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 DSJA are associated (or correlated) with Angel Oak. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Angel Oak Mortgage has no effect on the direction of DSJA i.e., DSJA and Angel Oak go up and down completely randomly.

Pair Corralation between DSJA and Angel Oak

If you would invest  849.00  in Angel Oak Mortgage Backed on November 19, 2024 and sell it today you would earn a total of  9.00  from holding Angel Oak Mortgage Backed or generate 1.06% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

DSJA  vs.  Angel Oak Mortgage Backed

DSJA

Risk-Adjusted Performance

Very Weak

Over the last 90 days DSJA has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong forward-looking indicators, DSJA is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Angel Oak Mortgage

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Angel Oak Mortgage Backed are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable fundamental drivers, Angel Oak is not utilizing all of its potentials. The recent stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with DSJA and Angel Oak

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

The idea behind DSJA and Angel Oak Mortgage Backed 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.

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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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.