Correlation Between ALLIANZ TECHNOTRLS and SYLVANIA PLAT

Can any of the company-specific risk be diversified away by investing in both ALLIANZ TECHNOTRLS and SYLVANIA PLAT 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 ALLIANZ TECHNOTRLS and SYLVANIA PLAT into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between ALLIANZ TECHNOTRLS 025 and SYLVANIA PLAT DL, you can compare the effects of market volatilities on ALLIANZ TECHNOTRLS and SYLVANIA PLAT 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 ALLIANZ TECHNOTRLS with a short position of SYLVANIA PLAT. Check out your portfolio center. Please also check ongoing floating volatility patterns of ALLIANZ TECHNOTRLS and SYLVANIA PLAT.

Diversification Opportunities for ALLIANZ TECHNOTRLS and SYLVANIA PLAT

-0.51

Correlation Coefficient

ALLIANZ TECHNOTRLS  SYLVANIA PLAT

Excellent diversification

The 3 months correlation between ALLIANZ and SYLVANIA is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding ALLIANZ TECHNOTRLS 025 and SYLVANIA PLAT DL in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SYLVANIA PLAT DL and ALLIANZ TECHNOTRLS 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 ALLIANZ TECHNOTRLS 025 are associated (or correlated) with SYLVANIA PLAT. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SYLVANIA PLAT DL has no effect on the direction of ALLIANZ TECHNOTRLS i.e., ALLIANZ TECHNOTRLS and SYLVANIA PLAT go up and down completely randomly.

Pair Corralation between ALLIANZ TECHNOTRLS and SYLVANIA PLAT

Assuming the 90 days horizon ALLIANZ TECHNOTRLS 025 is expected to generate 0.5 times more return on investment than SYLVANIA PLAT. However, ALLIANZ TECHNOTRLS 025 is 2.02 times less risky than SYLVANIA PLAT. It trades about 0.23 of its potential returns per unit of risk. SYLVANIA PLAT DL is currently generating about -0.13 per unit of risk. If you would invest  474.00  in ALLIANZ TECHNOTRLS 025 on September 30, 2024 and sell it today you would earn a total of  31.00  from holding ALLIANZ TECHNOTRLS 025 or generate 6.54% return on investment over 90 days.

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

ALLIANZ TECHNOTRLS 025  vs.  SYLVANIA PLAT DL

ALLIANZ TECHNOTRLS 025

Risk-Adjusted Performance

16 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in ALLIANZ TECHNOTRLS 025 are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, ALLIANZ TECHNOTRLS reported solid returns over the last few months and may actually be approaching a breakup point.

SYLVANIA PLAT DL

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days SYLVANIA PLAT DL has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest fragile performance, the Stock's basic indicators remain stable and the current disturbance on Wall Street may also be a sign of long-run gains for the company stockholders.

Pair Trading with ALLIANZ TECHNOTRLS and SYLVANIA PLAT

The main advantage of trading using opposite ALLIANZ TECHNOTRLS and SYLVANIA PLAT positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ALLIANZ TECHNOTRLS position performs unexpectedly, SYLVANIA PLAT 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 SYLVANIA PLAT will offset losses from the drop in SYLVANIA PLAT's long position.

The idea behind ALLIANZ TECHNOTRLS 025 and SYLVANIA PLAT DL 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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..