Correlation Between Allianzgi Nfj and Allianzgi Global

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

By analyzing existing cross correlation between Allianzgi Nfj International and Allianzgi Global Water, you can compare the effects of market volatilities on Allianzgi Nfj and Allianzgi Global 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 Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Allianzgi Nfj and Allianzgi Global.

Diversification Opportunities for Allianzgi Nfj and Allianzgi Global

0.67

Correlation Coefficient

Allianzgi Nfj  Allianzgi Global

Poor diversification

The 3 months correlation between Allianzgi and Allianzgi is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding Allianzgi Nfj International and Allianzgi Global Water in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Allianzgi Global Water 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 International are associated (or correlated) with Allianzgi Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Allianzgi Global Water has no effect on the direction of Allianzgi Nfj i.e., Allianzgi Nfj and Allianzgi Global go up and down completely randomly.

Pair Corralation between Allianzgi Nfj and Allianzgi Global

Assuming the 90 days horizon Allianzgi Nfj International is expected to under-perform the Allianzgi Global. But the mutual fund apears to be less risky and, when comparing its historical volatility, Allianzgi Nfj International is 1.03 times less risky than Allianzgi Global. The mutual fund trades about -0.01 of its potential returns per unit of risk. The Allianzgi Global Water is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest  1,834  in Allianzgi Global Water on September 28, 2024 and sell it today you would earn a total of  38.00  from holding Allianzgi Global Water or generate 2.07% return on investment over 90 days.

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

Allianzgi Nfj International  vs.  Allianzgi Global Water

Allianzgi Nfj Intern

Risk-Adjusted Performance

0 of 100

Very Weak

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

Allianzgi Global Water

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Allianzgi Global Water has generated negative risk-adjusted returns adding no value to fund investors. In spite of weak performance in the last few months, the Fund's forward indicators remain fairly strong which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long term up-swing for the fund investors.

Pair Trading with Allianzgi Nfj and Allianzgi Global

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

The idea behind Allianzgi Nfj International and Allianzgi Global Water 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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.