Correlation Between Angel Oak and Harbor Mid
Can any of the company-specific risk be diversified away by investing in both Angel Oak and Harbor Mid 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 Harbor Mid 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 Harbor Mid Cap, you can compare the effects of market volatilities on Angel Oak and Harbor Mid 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 Harbor Mid. Check out your portfolio center. Please also check ongoing floating volatility patterns of Angel Oak and Harbor Mid.
Diversification Opportunities for Angel Oak and Harbor Mid
0.66 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Angel and Harbor is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Angel Oak Financial and Harbor Mid Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Harbor Mid Cap 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 Harbor Mid. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Harbor Mid Cap has no effect on the direction of Angel Oak i.e., Angel Oak and Harbor Mid go up and down completely randomly.
Pair Corralation between Angel Oak and Harbor Mid
Assuming the 90 days horizon Angel Oak is expected to generate 16.36 times less return on investment than Harbor Mid. But when comparing it to its historical volatility, Angel Oak Financial is 4.93 times less risky than Harbor Mid. It trades about 0.06 of its potential returns per unit of risk. Harbor Mid Cap is currently generating about 0.18 of returns per unit of risk over similar time horizon. If you would invest 614.00 in Harbor Mid Cap on August 28, 2024 and sell it today you would earn a total of 52.00 from holding Harbor Mid Cap or generate 8.47% 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. Harbor Mid Cap
Performance |
| Timeline |
| Angel Oak Financial |
| Harbor Mid Cap |
Angel Oak and Harbor Mid Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Angel Oak and Harbor Mid
The main advantage of trading using opposite Angel Oak and Harbor Mid positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Angel Oak position performs unexpectedly, Harbor Mid 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 Harbor Mid will offset losses from the drop in Harbor Mid's long position.| Angel Oak vs. Pace High Yield | Angel Oak vs. Ab Global Risk | Angel Oak vs. Ab High Income | Angel Oak vs. Calvert High Yield |
| Harbor Mid vs. Angel Oak Financial | Harbor Mid vs. Royce Global Financial | Harbor Mid vs. Mesirow Financial Small | Harbor Mid vs. Icon Financial 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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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