Correlation Between Nationwide International and Angel Oak
Can any of the company-specific risk be diversified away by investing in both Nationwide International 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 Nationwide International and Angel Oak into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nationwide International Index and Angel Oak Multi Strategy, you can compare the effects of market volatilities on Nationwide International 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 Nationwide International with a short position of Angel Oak. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nationwide International and Angel Oak.
Diversification Opportunities for Nationwide International and Angel Oak
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Nationwide and Angel is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Nationwide International Index and Angel Oak Multi Strategy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Angel Oak Multi and Nationwide International 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 Nationwide International Index 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 Multi has no effect on the direction of Nationwide International i.e., Nationwide International and Angel Oak go up and down completely randomly.
Pair Corralation between Nationwide International and Angel Oak
Assuming the 90 days horizon Nationwide International Index is expected to generate 4.04 times more return on investment than Angel Oak. However, Nationwide International is 4.04 times more volatile than Angel Oak Multi Strategy. It trades about 0.05 of its potential returns per unit of risk. Angel Oak Multi Strategy is currently generating about 0.1 per unit of risk. If you would invest 734.00 in Nationwide International Index on August 30, 2024 and sell it today you would earn a total of 149.00 from holding Nationwide International Index or generate 20.3% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nationwide International Index vs. Angel Oak Multi Strategy
Performance |
| Timeline |
| Nationwide International |
| Angel Oak Multi |
Nationwide International and Angel Oak Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nationwide International and Angel Oak
The main advantage of trading using opposite Nationwide International and Angel Oak positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nationwide International 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.| Nationwide International vs. Amg River Road | Nationwide International vs. Great West Loomis Sayles | Nationwide International vs. Victory Rs Partners | Nationwide International vs. Boston Partners Small |
| Angel Oak vs. Pimco Income Fund | Angel Oak vs. HUMANA INC | Angel Oak vs. Aquagold International | Angel Oak vs. Barloworld Ltd ADR |
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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