Correlation Between Horizon Technology and Angel Oak
Can any of the company-specific risk be diversified away by investing in both Horizon Technology 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 Horizon Technology and Angel Oak into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Horizon Technology Finance and Angel Oak Financial, you can compare the effects of market volatilities on Horizon Technology 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 Horizon Technology with a short position of Angel Oak. Check out your portfolio center. Please also check ongoing floating volatility patterns of Horizon Technology and Angel Oak.
Diversification Opportunities for Horizon Technology and Angel Oak
0.22 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Horizon and Angel is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding Horizon Technology Finance and Angel Oak Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Angel Oak Financial and Horizon Technology 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 Horizon Technology Finance 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 Financial has no effect on the direction of Horizon Technology i.e., Horizon Technology and Angel Oak go up and down completely randomly.
Pair Corralation between Horizon Technology and Angel Oak
Given the investment horizon of 90 days Horizon Technology is expected to generate 10.53 times less return on investment than Angel Oak. In addition to that, Horizon Technology is 2.7 times more volatile than Angel Oak Financial. It trades about 0.0 of its total potential returns per unit of risk. Angel Oak Financial is currently generating about 0.07 per unit of volatility. If you would invest 1,090 in Angel Oak Financial on October 20, 2024 and sell it today you would earn a total of 214.00 from holding Angel Oak Financial or generate 19.63% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Horizon Technology Finance vs. Angel Oak Financial
Performance |
| Timeline |
| Horizon Technology |
| Angel Oak Financial |
Horizon Technology and Angel Oak Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Horizon Technology and Angel Oak
The main advantage of trading using opposite Horizon Technology and Angel Oak positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Horizon Technology 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.| Horizon Technology vs. Gladstone Capital | Horizon Technology vs. Gladstone Investment | Horizon Technology vs. Prospect Capital | Horizon Technology vs. Stellus Capital Investment |
| Angel Oak vs. Eaton Vance National | Angel Oak vs. Blackrock Muniholdings Ny | Angel Oak vs. Nuveen California Select | Angel Oak vs. MFS Investment Grade |
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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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