Correlation Between Angel Oak and Fuller Thaler
Can any of the company-specific risk be diversified away by investing in both Angel Oak and Fuller Thaler 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 Fuller Thaler 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 Fuller Thaler Behavioral, you can compare the effects of market volatilities on Angel Oak and Fuller Thaler 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 Fuller Thaler. Check out your portfolio center. Please also check ongoing floating volatility patterns of Angel Oak and Fuller Thaler.
Diversification Opportunities for Angel Oak and Fuller Thaler
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Angel and Fuller is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Angel Oak Financial and Fuller Thaler Behavioral in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fuller Thaler Behavioral 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 Fuller Thaler. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fuller Thaler Behavioral has no effect on the direction of Angel Oak i.e., Angel Oak and Fuller Thaler go up and down completely randomly.
Pair Corralation between Angel Oak and Fuller Thaler
Assuming the 90 days horizon Angel Oak is expected to generate 15.21 times less return on investment than Fuller Thaler. But when comparing it to its historical volatility, Angel Oak Financial is 6.24 times less risky than Fuller Thaler. It trades about 0.11 of its potential returns per unit of risk. Fuller Thaler Behavioral is currently generating about 0.27 of returns per unit of risk over similar time horizon. If you would invest 4,831 in Fuller Thaler Behavioral on September 1, 2024 and sell it today you would earn a total of 393.00 from holding Fuller Thaler Behavioral or generate 8.13% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Angel Oak Financial vs. Fuller Thaler Behavioral
Performance |
| Timeline |
| Angel Oak Financial |
| Fuller Thaler Behavioral |
Angel Oak and Fuller Thaler Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Angel Oak and Fuller Thaler
The main advantage of trading using opposite Angel Oak and Fuller Thaler positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Angel Oak position performs unexpectedly, Fuller Thaler 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 Fuller Thaler will offset losses from the drop in Fuller Thaler'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 |
| Fuller Thaler vs. T Rowe Price | Fuller Thaler vs. Mirova Global Green | Fuller Thaler vs. Commonwealth Global Fund | Fuller Thaler vs. Us Global Leaders |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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