Correlation Between Prudential Floating and Angel Oak

Can any of the company-specific risk be diversified away by investing in both Prudential Floating 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 Prudential Floating and Angel Oak into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Prudential Floating Rate and Angel Oak Ultrashort, you can compare the effects of market volatilities on Prudential Floating 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 Prudential Floating with a short position of Angel Oak. Check out your portfolio center. Please also check ongoing floating volatility patterns of Prudential Floating and Angel Oak.

Diversification Opportunities for Prudential Floating and Angel Oak

0.93

Correlation Coefficient

Prudential Floating  Angel Oak

Almost no diversification

The 3 months correlation between Prudential and Angel is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding Prudential Floating Rate and Angel Oak Ultrashort in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Angel Oak Ultrashort and Prudential Floating 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 Prudential Floating Rate 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 Ultrashort has no effect on the direction of Prudential Floating i.e., Prudential Floating and Angel Oak go up and down completely randomly.

Pair Corralation between Prudential Floating and Angel Oak

If you would invest  909.00  in Prudential Floating Rate on September 25, 2024 and sell it today you would earn a total of  5.00  from holding Prudential Floating Rate or generate 0.55% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Strong
Accuracy	100.0%
Values	Daily Returns

Prudential Floating Rate  vs.  Angel Oak Ultrashort

Prudential Floating Rate

Risk-Adjusted Performance

20 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Prudential Floating Rate are ranked lower than 20 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, Prudential Floating is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Angel Oak Ultrashort

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Angel Oak Ultrashort are ranked lower than 8 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong forward indicators, Angel Oak is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Prudential Floating and Angel Oak

The main advantage of trading using opposite Prudential Floating and Angel Oak positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Prudential Floating 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.

The idea behind Prudential Floating Rate and Angel Oak Ultrashort pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.