Correlation Between Angel Oak and Mainstay Large
Can any of the company-specific risk be diversified away by investing in both Angel Oak and Mainstay Large 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 Mainstay Large 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 Mainstay Large Cap, you can compare the effects of market volatilities on Angel Oak and Mainstay Large 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 Mainstay Large. Check out your portfolio center. Please also check ongoing floating volatility patterns of Angel Oak and Mainstay Large.
Diversification Opportunities for Angel Oak and Mainstay Large
-0.18 | Correlation Coefficient |
Good diversification
The 3 months correlation between Angel and Mainstay is -0.18. Overlapping area represents the amount of risk that can be diversified away by holding Angel Oak Financial and Mainstay Large Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mainstay Large 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 Mainstay Large. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mainstay Large Cap has no effect on the direction of Angel Oak i.e., Angel Oak and Mainstay Large go up and down completely randomly.
Pair Corralation between Angel Oak and Mainstay Large
Assuming the 90 days horizon Angel Oak Financial is expected to generate 0.05 times more return on investment than Mainstay Large. However, Angel Oak Financial is 19.5 times less risky than Mainstay Large. It trades about 0.09 of its potential returns per unit of risk. Mainstay Large Cap is currently generating about -0.18 per unit of risk. If you would invest 1,408 in Angel Oak Financial on September 14, 2024 and sell it today you would earn a total of 6.00 from holding Angel Oak Financial or generate 0.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Angel Oak Financial vs. Mainstay Large Cap
Performance |
| Timeline |
| Angel Oak Financial |
| Mainstay Large Cap |
Angel Oak and Mainstay Large Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Angel Oak and Mainstay Large
The main advantage of trading using opposite Angel Oak and Mainstay Large positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Angel Oak position performs unexpectedly, Mainstay Large 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 Mainstay Large will offset losses from the drop in Mainstay Large's long position.| Angel Oak vs. Gabelli Convertible And | Angel Oak vs. Absolute Convertible Arbitrage | Angel Oak vs. Rationalpier 88 Convertible | Angel Oak vs. Virtus Convertible |
| Mainstay Large vs. Angel Oak Financial | Mainstay Large vs. Blackrock Financial Institutions | Mainstay Large vs. 1919 Financial Services | Mainstay Large vs. Gabelli Global Financial |
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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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