Correlation Between Global X and Angel Oak
Can any of the company-specific risk be diversified away by investing in both Global X and Angel Oak 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 Global X and Angel Oak into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Global X Robotics and Angel Oak Flexible, you can compare the effects of market volatilities on Global X and Angel Oak 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 Global X with a short position of Angel Oak. Check out your portfolio center. Please also check ongoing floating volatility patterns of Global X and Angel Oak.
Diversification Opportunities for Global X and Angel Oak
Very weak diversification
The 3 months correlation between Global and Angel is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding Global X Robotics and Angel Oak Flexible in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Angel Oak Flexible and Global X 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 Global X Robotics are associated (or correlated) with Angel Oak. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Angel Oak Flexible has no effect on the direction of Global X i.e., Global X and Angel Oak go up and down completely randomly.
Pair Corralation between Global X and Angel Oak
Given the investment horizon of 90 days Global X is expected to generate 1.63 times less return on investment than Angel Oak. In addition to that, Global X is 6.79 times more volatile than Angel Oak Flexible. It trades about 0.02 of its total potential returns per unit of risk. Angel Oak Flexible is currently generating about 0.23 per unit of volatility. If you would invest 752.00 in Angel Oak Flexible on January 26, 2024 and sell it today you would earn a total of 22.00 from holding Angel Oak Flexible or generate 2.93% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Global X Robotics vs. Angel Oak Flexible
Performance |
| Timeline |
| Global X Robotics |
| Angel Oak Flexible |
Global X and Angel Oak Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Global X and Angel Oak
The main advantage of trading using opposite Global X and Angel Oak positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Global X position performs unexpectedly, Angel Oak 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 Angel Oak will offset losses from the drop in Angel Oak's long position.| Global X vs. SPDR Kensho New | Global X vs. iShares Robotics and | Global X vs. Global X FinTech | Global X vs. Invesco SP SmallCap |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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