Correlation Between Angel Oak and Dreyfus Technology
Can any of the company-specific risk be diversified away by investing in both Angel Oak and Dreyfus Technology 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 Dreyfus Technology 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 Dreyfus Technology Growth, you can compare the effects of market volatilities on Angel Oak and Dreyfus Technology 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 Dreyfus Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Angel Oak and Dreyfus Technology.
Diversification Opportunities for Angel Oak and Dreyfus Technology
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Angel and Dreyfus is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Angel Oak Financial and Dreyfus Technology Growth in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dreyfus Technology Growth 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 Dreyfus Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dreyfus Technology Growth has no effect on the direction of Angel Oak i.e., Angel Oak and Dreyfus Technology go up and down completely randomly.
Pair Corralation between Angel Oak and Dreyfus Technology
Assuming the 90 days horizon Angel Oak is expected to generate 6.28 times less return on investment than Dreyfus Technology. But when comparing it to its historical volatility, Angel Oak Financial is 4.56 times less risky than Dreyfus Technology. It trades about 0.08 of its potential returns per unit of risk. Dreyfus Technology Growth is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 7,865 in Dreyfus Technology Growth on September 19, 2024 and sell it today you would earn a total of 173.00 from holding Dreyfus Technology Growth or generate 2.2% 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. Dreyfus Technology Growth
Performance |
| Timeline |
| Angel Oak Financial |
| Dreyfus Technology Growth |
Angel Oak and Dreyfus Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Angel Oak and Dreyfus Technology
The main advantage of trading using opposite Angel Oak and Dreyfus Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Angel Oak position performs unexpectedly, Dreyfus Technology 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 Dreyfus Technology will offset losses from the drop in Dreyfus Technology's long position.| Angel Oak vs. Aqr Long Short Equity | Angel Oak vs. Fidelity Sai Short Term | Angel Oak vs. Franklin Federal Limited Term | Angel Oak vs. Barings Active Short |
| Dreyfus Technology vs. John Hancock Financial | Dreyfus Technology vs. Blackrock Financial Institutions | Dreyfus Technology vs. Angel Oak Financial | Dreyfus Technology vs. Prudential Jennison 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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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