Correlation Between Angel Oak and Massmutual Select
Can any of the company-specific risk be diversified away by investing in both Angel Oak and Massmutual Select 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 Massmutual Select 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 Massmutual Select T, you can compare the effects of market volatilities on Angel Oak and Massmutual Select 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 Massmutual Select. Check out your portfolio center. Please also check ongoing floating volatility patterns of Angel Oak and Massmutual Select.
Diversification Opportunities for Angel Oak and Massmutual Select
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Angel and Massmutual is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Angel Oak Financial and Massmutual Select T in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Massmutual Select 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 Massmutual Select. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Massmutual Select has no effect on the direction of Angel Oak i.e., Angel Oak and Massmutual Select go up and down completely randomly.
Pair Corralation between Angel Oak and Massmutual Select
Assuming the 90 days horizon Angel Oak Financial is expected to under-perform the Massmutual Select. But the mutual fund apears to be less risky and, when comparing its historical volatility, Angel Oak Financial is 1.77 times less risky than Massmutual Select. The mutual fund trades about -0.03 of its potential returns per unit of risk. The Massmutual Select T is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 1,158 in Massmutual Select T on September 12, 2024 and sell it today you would earn a total of 268.00 from holding Massmutual Select T or generate 23.14% 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. Massmutual Select T
Performance |
| Timeline |
| Angel Oak Financial |
| Massmutual Select |
Angel Oak and Massmutual Select Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Angel Oak and Massmutual Select
The main advantage of trading using opposite Angel Oak and Massmutual Select positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Angel Oak position performs unexpectedly, Massmutual Select 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 Massmutual Select will offset losses from the drop in Massmutual Select's long position.| Angel Oak vs. Huber Capital Diversified | Angel Oak vs. Western Asset Diversified | Angel Oak vs. Sentinel Small Pany | Angel Oak vs. Blackrock Sm Cap |
| Massmutual Select vs. Transamerica Financial Life | Massmutual Select vs. Davis Financial Fund | Massmutual Select vs. Financials Ultrasector Profund | Massmutual Select vs. Goldman Sachs 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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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