Correlation Between Tiaa-cref High-yield and Angel Oak
Can any of the company-specific risk be diversified away by investing in both Tiaa-cref High-yield 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 Tiaa-cref High-yield and Angel Oak into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Tiaa Cref High Yield Fund and Angel Oak Financial, you can compare the effects of market volatilities on Tiaa-cref High-yield 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 Tiaa-cref High-yield with a short position of Angel Oak. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tiaa-cref High-yield and Angel Oak.
Diversification Opportunities for Tiaa-cref High-yield and Angel Oak
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Tiaa-cref and Angel is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Tiaa Cref High Yield Fund 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 Tiaa-cref High-yield 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 Tiaa Cref High Yield Fund 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 Tiaa-cref High-yield i.e., Tiaa-cref High-yield and Angel Oak go up and down completely randomly.
Pair Corralation between Tiaa-cref High-yield and Angel Oak
Assuming the 90 days horizon Tiaa Cref High Yield Fund is expected to generate 1.18 times more return on investment than Angel Oak. However, Tiaa-cref High-yield is 1.18 times more volatile than Angel Oak Financial. It trades about 0.15 of its potential returns per unit of risk. Angel Oak Financial is currently generating about -0.04 per unit of risk. If you would invest 733.00 in Tiaa Cref High Yield Fund on November 1, 2024 and sell it today you would earn a total of 158.00 from holding Tiaa Cref High Yield Fund or generate 21.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.79% |
| Values | Daily Returns |
Tiaa Cref High Yield Fund vs. Angel Oak Financial
Performance |
| Timeline |
| Tiaa-cref High-yield |
| Angel Oak Financial |
Tiaa-cref High-yield and Angel Oak Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tiaa-cref High-yield and Angel Oak
The main advantage of trading using opposite Tiaa-cref High-yield and Angel Oak positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tiaa-cref High-yield 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.| Tiaa-cref High-yield vs. Pace High Yield | Tiaa-cref High-yield vs. Prudential High Yield | Tiaa-cref High-yield vs. Mesirow Financial High | Tiaa-cref High-yield vs. Gmo High Yield |
| Angel Oak vs. Transamerica High Yield | Angel Oak vs. Dunham High Yield | Angel Oak vs. Federated High Yield | Angel Oak vs. Tiaa Cref High Yield Fund |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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