Correlation Between Virtus AllianzGI and CBH

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

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

Diversification Opportunities for Virtus AllianzGI and CBH

-0.94

Correlation Coefficient

Virtus AllianzGI  CBH

Pay attention - limited upside

The 3 months correlation between Virtus and CBH is -0.94. Overlapping area represents the amount of risk that can be diversified away by holding Virtus AllianzGI Convertible and CBH in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CBH and Virtus AllianzGI 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 Virtus AllianzGI Convertible are associated (or correlated) with CBH. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CBH has no effect on the direction of Virtus AllianzGI i.e., Virtus AllianzGI and CBH go up and down completely randomly.

Pair Corralation between Virtus AllianzGI and CBH

If you would invest  919.00  in CBH on October 7, 2024 and sell it today you would earn a total of  0.00  from holding CBH or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Significant
Accuracy	5.0%
Values	Daily Returns

Virtus AllianzGI Convertible  vs.  CBH

Virtus AllianzGI Con

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Virtus AllianzGI Convertible has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, Virtus AllianzGI is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

CBH

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days CBH has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong fundamental drivers, CBH is not utilizing all of its potentials. The newest stock price confusion, may contribute to short-horizon losses for the traders.

Pair Trading with Virtus AllianzGI and CBH

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

The idea behind Virtus AllianzGI Convertible and CBH 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.

Check out your portfolio center.

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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.