Correlation Between Angel Oak and Bny Mellon
Can any of the company-specific risk be diversified away by investing in both Angel Oak and Bny Mellon 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 Bny Mellon 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 Bny Mellon National, you can compare the effects of market volatilities on Angel Oak and Bny Mellon 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 Bny Mellon. Check out your portfolio center. Please also check ongoing floating volatility patterns of Angel Oak and Bny Mellon.
Diversification Opportunities for Angel Oak and Bny Mellon
0.08 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Angel and Bny is 0.08. Overlapping area represents the amount of risk that can be diversified away by holding Angel Oak Financial and Bny Mellon National in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bny Mellon National 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 Bny Mellon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bny Mellon National has no effect on the direction of Angel Oak i.e., Angel Oak and Bny Mellon go up and down completely randomly.
Pair Corralation between Angel Oak and Bny Mellon
Assuming the 90 days horizon Angel Oak is expected to generate 1.8 times less return on investment than Bny Mellon. In addition to that, Angel Oak is 2.28 times more volatile than Bny Mellon National. It trades about 0.12 of its total potential returns per unit of risk. Bny Mellon National is currently generating about 0.51 per unit of volatility. If you would invest 1,293 in Bny Mellon National on September 13, 2024 and sell it today you would earn a total of 14.00 from holding Bny Mellon National or generate 1.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Angel Oak Financial vs. Bny Mellon National
Performance |
| Timeline |
| Angel Oak Financial |
| Bny Mellon National |
Angel Oak and Bny Mellon Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Angel Oak and Bny Mellon
The main advantage of trading using opposite Angel Oak and Bny Mellon positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Angel Oak position performs unexpectedly, Bny Mellon 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 Bny Mellon will offset losses from the drop in Bny Mellon's 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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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