Correlation Between Allianzgi Mid-cap and Allianzgi Nfj

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

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

Diversification Opportunities for Allianzgi Mid-cap and Allianzgi Nfj

0.34

Correlation Coefficient

Allianzgi Mid-cap  Allianzgi Nfj

Weak diversification

The 3 months correlation between Allianzgi and Allianzgi is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding Allianzgi Mid Cap Fund and Allianzgi Nfj Dividend in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Allianzgi Nfj Dividend and Allianzgi Mid-cap 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 Mid Cap Fund are associated (or correlated) with Allianzgi Nfj. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Allianzgi Nfj Dividend has no effect on the direction of Allianzgi Mid-cap i.e., Allianzgi Mid-cap and Allianzgi Nfj go up and down completely randomly.

Pair Corralation between Allianzgi Mid-cap and Allianzgi Nfj

Assuming the 90 days horizon Allianzgi Mid Cap Fund is expected to generate 1.52 times more return on investment than Allianzgi Nfj. However, Allianzgi Mid-cap is 1.52 times more volatile than Allianzgi Nfj Dividend. It trades about 0.14 of its potential returns per unit of risk. Allianzgi Nfj Dividend is currently generating about -0.05 per unit of risk. If you would invest  554.00  in Allianzgi Mid Cap Fund on November 20, 2024 and sell it today you would earn a total of  94.00  from holding Allianzgi Mid Cap Fund or generate 16.97% return on investment over 90 days.

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

Allianzgi Mid Cap Fund  vs.  Allianzgi Nfj Dividend

Allianzgi Mid Cap

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Allianzgi Mid Cap Fund are ranked lower than 7 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak fundamental indicators, Allianzgi Mid-cap may actually be approaching a critical reversion point that can send shares even higher in March 2025.

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 technical and fundamental indicators, Allianzgi Nfj is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Allianzgi Mid-cap and Allianzgi Nfj

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

The idea behind Allianzgi Mid Cap Fund and Allianzgi Nfj Dividend 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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.