Correlation Between Angel Oak and Shelton Emerging
Can any of the company-specific risk be diversified away by investing in both Angel Oak and Shelton 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 Angel Oak and Shelton Emerging 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 Shelton Emerging Markets, you can compare the effects of market volatilities on Angel Oak and Shelton 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 Angel Oak with a short position of Shelton Emerging. Check out your portfolio center. Please also check ongoing floating volatility patterns of Angel Oak and Shelton Emerging.
Diversification Opportunities for Angel Oak and Shelton Emerging
0.06 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Angel and Shelton is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding Angel Oak Multi Strategy and Shelton Emerging Markets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shelton Emerging Markets 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 Shelton Emerging. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shelton Emerging Markets has no effect on the direction of Angel Oak i.e., Angel Oak and Shelton Emerging go up and down completely randomly.
Pair Corralation between Angel Oak and Shelton Emerging
Assuming the 90 days horizon Angel Oak Multi Strategy is expected to generate 0.18 times more return on investment than Shelton Emerging. However, Angel Oak Multi Strategy is 5.56 times less risky than Shelton Emerging. It trades about -0.07 of its potential returns per unit of risk. Shelton Emerging Markets is currently generating about -0.21 per unit of risk. If you would invest 855.00 in Angel Oak Multi Strategy on August 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 Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Angel Oak Multi Strategy vs. Shelton Emerging Markets
Performance |
| Timeline |
| Angel Oak Multi |
| Shelton Emerging Markets |
Angel Oak and Shelton Emerging Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Angel Oak and Shelton Emerging
The main advantage of trading using opposite Angel Oak and Shelton Emerging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Angel Oak position performs unexpectedly, Shelton 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 Shelton Emerging will offset losses from the drop in Shelton Emerging'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 |
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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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