Correlation Between Angel Oak and Aqr Large
Can any of the company-specific risk be diversified away by investing in both Angel Oak and Aqr Large 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 Aqr Large 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 Aqr Large Cap, you can compare the effects of market volatilities on Angel Oak and Aqr Large 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 Aqr Large. Check out your portfolio center. Please also check ongoing floating volatility patterns of Angel Oak and Aqr Large.
Diversification Opportunities for Angel Oak and Aqr Large
Very good diversification
The 3 months correlation between Angel and Aqr is -0.49. Overlapping area represents the amount of risk that can be diversified away by holding Angel Oak Ultrashort and Aqr Large Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aqr Large Cap 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 Aqr Large. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aqr Large Cap has no effect on the direction of Angel Oak i.e., Angel Oak and Aqr Large go up and down completely randomly.
Pair Corralation between Angel Oak and Aqr Large
Assuming the 90 days horizon Angel Oak is expected to generate 2.8 times less return on investment than Aqr Large. But when comparing it to its historical volatility, Angel Oak Ultrashort is 7.22 times less risky than Aqr Large. It trades about 0.23 of its potential returns per unit of risk. Aqr Large Cap is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 1,895 in Aqr Large Cap on October 22, 2024 and sell it today you would earn a total of 26.00 from holding Aqr Large Cap or generate 1.37% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Angel Oak Ultrashort vs. Aqr Large Cap
Performance |
| Timeline |
| Angel Oak Ultrashort |
| Aqr Large Cap |
Angel Oak and Aqr Large Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Angel Oak and Aqr Large
The main advantage of trading using opposite Angel Oak and Aqr Large positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Angel Oak position performs unexpectedly, Aqr Large 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 Aqr Large will offset losses from the drop in Aqr Large's long position.| Angel Oak vs. Glg Intl Small | Angel Oak vs. Lkcm Small Cap | Angel Oak vs. Tax Managed Mid Small | Angel Oak vs. Vy Columbia Small |
| Aqr Large vs. Absolute Convertible Arbitrage | Aqr Large vs. Putnam Convertible Securities | Aqr Large vs. Allianzgi Convertible Income | Aqr Large vs. Virtus Convertible |
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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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