Correlation Between Angel Oak and Cref Money
Can any of the company-specific risk be diversified away by investing in both Angel Oak and Cref Money 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 Cref Money 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 Cref Money Market, you can compare the effects of market volatilities on Angel Oak and Cref Money 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 Cref Money. Check out your portfolio center. Please also check ongoing floating volatility patterns of Angel Oak and Cref Money.
Diversification Opportunities for Angel Oak and Cref Money
0.25 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Angel and Cref is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding Angel Oak Financial and Cref Money Market in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cref Money Market 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 Cref Money. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cref Money Market has no effect on the direction of Angel Oak i.e., Angel Oak and Cref Money go up and down completely randomly.
Pair Corralation between Angel Oak and Cref Money
Assuming the 90 days horizon Angel Oak is expected to generate 4.54 times less return on investment than Cref Money. In addition to that, Angel Oak is 11.14 times more volatile than Cref Money Market. It trades about 0.02 of its total potential returns per unit of risk. Cref Money Market is currently generating about 0.93 per unit of volatility. If you would invest 2,993 in Cref Money Market on November 29, 2024 and sell it today you would earn a total of 10.00 from holding Cref Money Market or generate 0.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Angel Oak Financial vs. Cref Money Market
Performance |
| Timeline |
| Angel Oak Financial |
| Cref Money Market |
Angel Oak and Cref Money Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Angel Oak and Cref Money
The main advantage of trading using opposite Angel Oak and Cref Money positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Angel Oak position performs unexpectedly, Cref Money 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 Cref Money will offset losses from the drop in Cref Money's long position.| Angel Oak vs. Rbc Emerging Markets | Angel Oak vs. Calvert Developed Market | Angel Oak vs. Aqr Sustainable Long Short | Angel Oak vs. Investec Emerging Markets |
| Cref Money vs. Touchstone Small Cap | Cref Money vs. Ep Emerging Markets | Cref Money vs. Ab Small Cap | Cref Money vs. United Kingdom Small |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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