Correlation Between Angel Oak and Nuveen Ohio
Can any of the company-specific risk be diversified away by investing in both Angel Oak and Nuveen Ohio 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 Nuveen Ohio 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 Nuveen Ohio Municipal, you can compare the effects of market volatilities on Angel Oak and Nuveen Ohio 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 Nuveen Ohio. Check out your portfolio center. Please also check ongoing floating volatility patterns of Angel Oak and Nuveen Ohio.
Diversification Opportunities for Angel Oak and Nuveen Ohio
-0.56 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Angel and Nuveen is -0.56. Overlapping area represents the amount of risk that can be diversified away by holding Angel Oak Financial and Nuveen Ohio Municipal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nuveen Ohio Municipal 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 Nuveen Ohio. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nuveen Ohio Municipal has no effect on the direction of Angel Oak i.e., Angel Oak and Nuveen Ohio go up and down completely randomly.
Pair Corralation between Angel Oak and Nuveen Ohio
Assuming the 90 days horizon Angel Oak is expected to generate 1.95 times less return on investment than Nuveen Ohio. But when comparing it to its historical volatility, Angel Oak Financial is 1.29 times less risky than Nuveen Ohio. It trades about 0.15 of its potential returns per unit of risk. Nuveen Ohio Municipal is currently generating about 0.23 of returns per unit of risk over similar time horizon. If you would invest 1,072 in Nuveen Ohio Municipal on September 2, 2024 and sell it today you would earn a total of 15.00 from holding Nuveen Ohio Municipal or generate 1.4% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Angel Oak Financial vs. Nuveen Ohio Municipal
Performance |
| Timeline |
| Angel Oak Financial |
| Nuveen Ohio Municipal |
Angel Oak and Nuveen Ohio Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Angel Oak and Nuveen Ohio
The main advantage of trading using opposite Angel Oak and Nuveen Ohio positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Angel Oak position performs unexpectedly, Nuveen Ohio 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 Nuveen Ohio will offset losses from the drop in Nuveen Ohio's 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 |
| Nuveen Ohio vs. Oppenheimer Gold Special | Nuveen Ohio vs. Precious Metals And | Nuveen Ohio vs. Vy Goldman Sachs | Nuveen Ohio vs. Gabelli Gold 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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