Correlation Between Angel Oak and Catalystmillburn
Can any of the company-specific risk be diversified away by investing in both Angel Oak and Catalystmillburn 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 Catalystmillburn 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 Catalystmillburn Hedge Strategy, you can compare the effects of market volatilities on Angel Oak and Catalystmillburn 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 Catalystmillburn. Check out your portfolio center. Please also check ongoing floating volatility patterns of Angel Oak and Catalystmillburn.
Diversification Opportunities for Angel Oak and Catalystmillburn
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Angel and Catalystmillburn is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Angel Oak Ultrashort and Catalystmillburn Hedge Strateg in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Catalystmillburn Hedge 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 Catalystmillburn. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Catalystmillburn Hedge has no effect on the direction of Angel Oak i.e., Angel Oak and Catalystmillburn go up and down completely randomly.
Pair Corralation between Angel Oak and Catalystmillburn
Assuming the 90 days horizon Angel Oak is expected to generate 2.13 times less return on investment than Catalystmillburn. But when comparing it to its historical volatility, Angel Oak Ultrashort is 5.98 times less risky than Catalystmillburn. It trades about 0.23 of its potential returns per unit of risk. Catalystmillburn Hedge Strategy is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 3,396 in Catalystmillburn Hedge Strategy on September 14, 2024 and sell it today you would earn a total of 469.00 from holding Catalystmillburn Hedge Strategy or generate 13.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Angel Oak Ultrashort vs. Catalystmillburn Hedge Strateg
Performance |
| Timeline |
| Angel Oak Ultrashort |
| Catalystmillburn Hedge |
Angel Oak and Catalystmillburn Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Angel Oak and Catalystmillburn
The main advantage of trading using opposite Angel Oak and Catalystmillburn positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Angel Oak position performs unexpectedly, Catalystmillburn 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 Catalystmillburn will offset losses from the drop in Catalystmillburn's long position.| Angel Oak vs. Ftfa Franklin Templeton Growth | Angel Oak vs. Vy Baron Growth | Angel Oak vs. Qs Defensive Growth | Angel Oak vs. T Rowe Price |
| Catalystmillburn vs. T Rowe Price | Catalystmillburn vs. Fidelity Advisor Diversified | Catalystmillburn vs. Pioneer Diversified High | Catalystmillburn vs. Small Cap Stock |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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