Correlation Between Angel Oak and Cohen Steers
Can any of the company-specific risk be diversified away by investing in both Angel Oak and Cohen Steers 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 Cohen Steers into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Angel Oak Financial and Cohen Steers Preferred, you can compare the effects of market volatilities on Angel Oak and Cohen Steers 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 Cohen Steers. Check out your portfolio center. Please also check ongoing floating volatility patterns of Angel Oak and Cohen Steers.
Diversification Opportunities for Angel Oak and Cohen Steers
0.61 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Angel and Cohen is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding Angel Oak Financial and Cohen Steers Preferred in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cohen Steers Preferred 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 Financial are associated (or correlated) with Cohen Steers. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cohen Steers Preferred has no effect on the direction of Angel Oak i.e., Angel Oak and Cohen Steers go up and down completely randomly.
Pair Corralation between Angel Oak and Cohen Steers
Assuming the 90 days horizon Angel Oak Financial is expected to generate 1.31 times more return on investment than Cohen Steers. However, Angel Oak is 1.31 times more volatile than Cohen Steers Preferred. It trades about 0.11 of its potential returns per unit of risk. Cohen Steers Preferred is currently generating about 0.02 per unit of risk. If you would invest 1,401 in Angel Oak Financial on September 1, 2024 and sell it today you would earn a total of 7.00 from holding Angel Oak Financial or generate 0.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Angel Oak Financial vs. Cohen Steers Preferred
Performance |
| Timeline |
| Angel Oak Financial |
| Cohen Steers Preferred |
Angel Oak and Cohen Steers Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Angel Oak and Cohen Steers
The main advantage of trading using opposite Angel Oak and Cohen Steers positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Angel Oak position performs unexpectedly, Cohen Steers 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 Cohen Steers will offset losses from the drop in Cohen Steers' long position.| Angel Oak vs. Vanguard Total Stock | Angel Oak vs. Vanguard 500 Index | Angel Oak vs. Vanguard Total Stock | Angel Oak vs. Vanguard Total Stock |
| Cohen Steers vs. Vanguard Financials Index | Cohen Steers vs. 1919 Financial Services | Cohen Steers vs. Angel Oak Financial | Cohen Steers vs. John Hancock Financial |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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