Correlation Between Angel Oak and Hartford Checks
Can any of the company-specific risk be diversified away by investing in both Angel Oak and Hartford Checks 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 Hartford Checks 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 The Hartford Checks, you can compare the effects of market volatilities on Angel Oak and Hartford Checks 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 Hartford Checks. Check out your portfolio center. Please also check ongoing floating volatility patterns of Angel Oak and Hartford Checks.
Diversification Opportunities for Angel Oak and Hartford Checks
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Angel and Hartford is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Angel Oak Financial and The Hartford Checks in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hartford Checks 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 Hartford Checks. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hartford Checks has no effect on the direction of Angel Oak i.e., Angel Oak and Hartford Checks go up and down completely randomly.
Pair Corralation between Angel Oak and Hartford Checks
Assuming the 90 days horizon Angel Oak is expected to generate 1.36 times less return on investment than Hartford Checks. But when comparing it to its historical volatility, Angel Oak Financial is 1.92 times less risky than Hartford Checks. It trades about 0.1 of its potential returns per unit of risk. The Hartford Checks is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 1,046 in The Hartford Checks on September 13, 2024 and sell it today you would earn a total of 12.00 from holding The Hartford Checks or generate 1.15% 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. The Hartford Checks
Performance |
| Timeline |
| Angel Oak Financial |
| Hartford Checks |
Angel Oak and Hartford Checks Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Angel Oak and Hartford Checks
The main advantage of trading using opposite Angel Oak and Hartford Checks positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Angel Oak position performs unexpectedly, Hartford Checks 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 Hartford Checks will offset losses from the drop in Hartford Checks' long position.| Angel Oak vs. Shelton Emerging Markets | Angel Oak vs. Pace International Emerging | Angel Oak vs. Rbc Emerging Markets | Angel Oak vs. Vy Jpmorgan Emerging |
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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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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