Correlation Between First Trust and Angel Oak
Can any of the company-specific risk be diversified away by investing in both First Trust 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 First Trust and Angel Oak into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between First Trust Managed and Angel Oak Multi Strategy, you can compare the effects of market volatilities on First Trust 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 First Trust with a short position of Angel Oak. Check out your portfolio center. Please also check ongoing floating volatility patterns of First Trust and Angel Oak.
Diversification Opportunities for First Trust and Angel Oak
0.55 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between First and Angel is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding First Trust Managed and Angel Oak Multi Strategy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Angel Oak Multi and First Trust 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 First Trust Managed 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 Multi has no effect on the direction of First Trust i.e., First Trust and Angel Oak go up and down completely randomly.
Pair Corralation between First Trust and Angel Oak
Assuming the 90 days horizon First Trust is expected to generate 3.26 times less return on investment than Angel Oak. But when comparing it to its historical volatility, First Trust Managed is 1.24 times less risky than Angel Oak. It trades about 0.09 of its potential returns per unit of risk. Angel Oak Multi Strategy is currently generating about 0.24 of returns per unit of risk over similar time horizon. If you would invest 845.00 in Angel Oak Multi Strategy on June 1, 2025 and sell it today you would earn a total of 18.00 from holding Angel Oak Multi Strategy or generate 2.13% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 98.44% |
| Values | Daily Returns |
First Trust Managed vs. Angel Oak Multi Strategy
Performance |
| Timeline |
| First Trust Managed |
| Angel Oak Multi |
First Trust and Angel Oak Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with First Trust and Angel Oak
The main advantage of trading using opposite First Trust and Angel Oak positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if First Trust 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.| First Trust vs. Siit Equity Factor | First Trust vs. Enhanced Fixed Income | First Trust vs. Rbc China Equity | First Trust vs. Franklin Equity Income |
| Angel Oak vs. Lord Abbett Diversified | Angel Oak vs. Blackrock Conservative Prprdptfinstttnl | Angel Oak vs. Global Diversified Income | Angel Oak vs. Aqr Diversified Arbitrage |
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 Valuation module to check real value of public entities based on technical and fundamental data.
Other Complementary Tools
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
| Equity Valuation Check real value of public entities based on technical and fundamental data |