Correlation Between Angel Oak and Voya Index
Can any of the company-specific risk be diversified away by investing in both Angel Oak and Voya Index 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 Voya Index into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Angel Oak Ultrashort and Voya Index Plus, you can compare the effects of market volatilities on Angel Oak and Voya Index 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 Voya Index. Check out your portfolio center. Please also check ongoing floating volatility patterns of Angel Oak and Voya Index.
Diversification Opportunities for Angel Oak and Voya Index
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Angel and Voya is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Angel Oak Ultrashort and Voya Index Plus in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Voya Index Plus 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 Ultrashort are associated (or correlated) with Voya Index. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Voya Index Plus has no effect on the direction of Angel Oak i.e., Angel Oak and Voya Index go up and down completely randomly.
Pair Corralation between Angel Oak and Voya Index
Assuming the 90 days horizon Angel Oak is expected to generate 17.27 times less return on investment than Voya Index. But when comparing it to its historical volatility, Angel Oak Ultrashort is 13.49 times less risky than Voya Index. It trades about 0.13 of its potential returns per unit of risk. Voya Index Plus is currently generating about 0.16 of returns per unit of risk over similar time horizon. If you would invest 3,029 in Voya Index Plus on September 12, 2024 and sell it today you would earn a total of 56.00 from holding Voya Index Plus or generate 1.85% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 95.45% |
| Values | Daily Returns |
Angel Oak Ultrashort vs. Voya Index Plus
Performance |
| Timeline |
| Angel Oak Ultrashort |
| Voya Index Plus |
Angel Oak and Voya Index Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Angel Oak and Voya Index
The main advantage of trading using opposite Angel Oak and Voya Index positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Angel Oak position performs unexpectedly, Voya Index 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 Voya Index will offset losses from the drop in Voya Index's long position.| Angel Oak vs. SCOR PK | Angel Oak vs. Morningstar Unconstrained Allocation | Angel Oak vs. Via Renewables | Angel Oak vs. Bondbloxx ETF Trust |
| Voya Index vs. Black Oak Emerging | Voya Index vs. Doubleline Emerging Markets | Voya Index vs. Pnc Emerging Markets | Voya Index vs. Shelton Emerging Markets |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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