Correlation Between Allianzgi Nfj and Allianzgi Focused

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

By analyzing existing cross correlation between Allianzgi Nfj Dividend and Allianzgi Focused Growth, you can compare the effects of market volatilities on Allianzgi Nfj and Allianzgi Focused 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 Allianzgi Nfj with a short position of Allianzgi Focused. Check out your portfolio center. Please also check ongoing floating volatility patterns of Allianzgi Nfj and Allianzgi Focused.

Diversification Opportunities for Allianzgi Nfj and Allianzgi Focused

0.77

Correlation Coefficient

Allianzgi Nfj  Allianzgi Focused

Poor diversification

The 3 months correlation between Allianzgi and Allianzgi is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding Allianzgi Nfj Dividend and Allianzgi Focused Growth in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Allianzgi Focused Growth and Allianzgi Nfj 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 Allianzgi Nfj Dividend are associated (or correlated) with Allianzgi Focused. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Allianzgi Focused Growth has no effect on the direction of Allianzgi Nfj i.e., Allianzgi Nfj and Allianzgi Focused go up and down completely randomly.

Pair Corralation between Allianzgi Nfj and Allianzgi Focused

Assuming the 90 days horizon Allianzgi Nfj Dividend is expected to generate 0.56 times more return on investment than Allianzgi Focused. However, Allianzgi Nfj Dividend is 1.79 times less risky than Allianzgi Focused. It trades about -0.02 of its potential returns per unit of risk. Allianzgi Focused Growth is currently generating about -0.09 per unit of risk. If you would invest  1,045  in Allianzgi Nfj Dividend on December 22, 2024 and sell it today you would lose (14.00) from holding Allianzgi Nfj Dividend or give up 1.34% of portfolio value over 90 days.

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

Allianzgi Nfj Dividend  vs.  Allianzgi Focused Growth

Allianzgi Nfj Dividend

Risk-Adjusted Performance

Very Weak

Over the last 90 days Allianzgi Nfj Dividend has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong basic indicators, Allianzgi Nfj is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Allianzgi Focused Growth

Risk-Adjusted Performance

Very Weak

Over the last 90 days Allianzgi Focused Growth has generated negative risk-adjusted returns adding no value to fund investors. In spite of latest weak performance, the Fund's technical and fundamental indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the fund investors.

Pair Trading with Allianzgi Nfj and Allianzgi Focused

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

The idea behind Allianzgi Nfj Dividend and Allianzgi Focused Growth 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 Bonds Directory module to find actively traded corporate debentures issued by US companies.