Correlation Between MUTUIONLINE and Allianz SE

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

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

Diversification Opportunities for MUTUIONLINE and Allianz SE

-0.29

Correlation Coefficient

MUTUIONLINE  Allianz SE

Very good diversification

The 3 months correlation between MUTUIONLINE and Allianz is -0.29. Overlapping area represents the amount of risk that can be diversified away by holding MUTUIONLINE and Allianz SE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Allianz SE and MUTUIONLINE 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 MUTUIONLINE are associated (or correlated) with Allianz SE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Allianz SE has no effect on the direction of MUTUIONLINE i.e., MUTUIONLINE and Allianz SE go up and down completely randomly.

Pair Corralation between MUTUIONLINE and Allianz SE

Assuming the 90 days trading horizon MUTUIONLINE is expected to generate 3.31 times less return on investment than Allianz SE. In addition to that, MUTUIONLINE is 2.35 times more volatile than Allianz SE. It trades about 0.02 of its total potential returns per unit of risk. Allianz SE is currently generating about 0.14 per unit of volatility. If you would invest  24,367  in Allianz SE on December 2, 2024 and sell it today you would earn a total of  8,533  from holding Allianz SE or generate 35.02% return on investment over 90 days.

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

MUTUIONLINE  vs.  Allianz SE

MUTUIONLINE

Risk-Adjusted Performance

Very Weak

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

Allianz SE

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Allianz SE are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. Despite nearly uncertain basic indicators, Allianz SE may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with MUTUIONLINE and Allianz SE

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

The idea behind MUTUIONLINE and Allianz SE 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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.