Correlation Between Allianz Technology and Raymond James

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

By analyzing existing cross correlation between Allianz Technology Trust and Raymond James Financial, you can compare the effects of market volatilities on Allianz Technology and Raymond James 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 Technology with a short position of Raymond James. Check out your portfolio center. Please also check ongoing floating volatility patterns of Allianz Technology and Raymond James.

Diversification Opportunities for Allianz Technology and Raymond James

0.83

Correlation Coefficient

Allianz Technology  Raymond James

Very poor diversification

The 3 months correlation between Allianz and Raymond is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Allianz Technology Trust and Raymond James Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Raymond James Financial and Allianz Technology 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 Technology Trust are associated (or correlated) with Raymond James. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Raymond James Financial has no effect on the direction of Allianz Technology i.e., Allianz Technology and Raymond James go up and down completely randomly.

Pair Corralation between Allianz Technology and Raymond James

Assuming the 90 days trading horizon Allianz Technology Trust is expected to under-perform the Raymond James. In addition to that, Allianz Technology is 1.11 times more volatile than Raymond James Financial. It trades about -0.09 of its total potential returns per unit of risk. Raymond James Financial is currently generating about -0.09 per unit of volatility. If you would invest  15,658  in Raymond James Financial on December 23, 2024 and sell it today you would lose (1,441) from holding Raymond James Financial or give up 9.2% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Strong
Accuracy	90.48%
Values	Daily Returns

Allianz Technology Trust  vs.  Raymond James Financial

Allianz Technology Trust

Risk-Adjusted Performance

Very Weak

Over the last 90 days Allianz Technology Trust has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest unsteady performance, the Stock's technical and fundamental indicators remain sound and the latest tumult on Wall Street may also be a sign of longer-term gains for the firm shareholders.

Raymond James Financial

Risk-Adjusted Performance

Very Weak

Over the last 90 days Raymond James Financial has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest unsteady performance, the Stock's basic indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

Pair Trading with Allianz Technology and Raymond James

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

The idea behind Allianz Technology Trust and Raymond James Financial 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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.