Correlation Between PennyMac Mortgage and Angel Oak
Can any of the company-specific risk be diversified away by investing in both PennyMac Mortgage 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 PennyMac Mortgage and Angel Oak into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PennyMac Mortgage Investment and Angel Oak Mortgage, you can compare the effects of market volatilities on PennyMac Mortgage 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 PennyMac Mortgage with a short position of Angel Oak. Check out your portfolio center. Please also check ongoing floating volatility patterns of PennyMac Mortgage and Angel Oak.
Diversification Opportunities for PennyMac Mortgage and Angel Oak
0.35 | Correlation Coefficient |
Weak diversification
The 3 months correlation between PennyMac and Angel is 0.35. Overlapping area represents the amount of risk that can be diversified away by holding PennyMac Mortgage Investment and Angel Oak Mortgage in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Angel Oak Mortgage and PennyMac Mortgage 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 PennyMac Mortgage Investment 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 Mortgage has no effect on the direction of PennyMac Mortgage i.e., PennyMac Mortgage and Angel Oak go up and down completely randomly.
Pair Corralation between PennyMac Mortgage and Angel Oak
Considering the 90-day investment horizon PennyMac Mortgage Investment is expected to under-perform the Angel Oak. But the stock apears to be less risky and, when comparing its historical volatility, PennyMac Mortgage Investment is 1.32 times less risky than Angel Oak. The stock trades about 0.0 of its potential returns per unit of risk. The Angel Oak Mortgage is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 902.00 in Angel Oak Mortgage on June 12, 2025 and sell it today you would earn a total of 73.00 from holding Angel Oak Mortgage or generate 8.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
PennyMac Mortgage Investment vs. Angel Oak Mortgage
Performance |
| Timeline |
| PennyMac Mortgage |
| Angel Oak Mortgage |
PennyMac Mortgage and Angel Oak Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PennyMac Mortgage and Angel Oak
The main advantage of trading using opposite PennyMac Mortgage and Angel Oak positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PennyMac Mortgage 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.| PennyMac Mortgage vs. Apollo Commercial Real | PennyMac Mortgage vs. KKR Real Estate | PennyMac Mortgage vs. Ellington Residential Mortgage | PennyMac Mortgage vs. Ares Commercial Real |
| Angel Oak vs. Granite Point Mortgage | Angel Oak vs. MFA Financial | Angel Oak vs. Two Harbors Investments | Angel Oak vs. PennyMac Mortgage Investment |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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