Correlation Between Allianzgi Equity and Brookfield Real

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

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

Diversification Opportunities for Allianzgi Equity and Brookfield Real

0.26

Correlation Coefficient

Allianzgi Equity  Brookfield Real

Modest diversification

The 3 months correlation between Allianzgi and Brookfield is 0.26. Overlapping area represents the amount of risk that can be diversified away by holding Allianzgi Equity Convertible and Brookfield Real Assets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Brookfield Real Assets and Allianzgi Equity 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 Equity Convertible are associated (or correlated) with Brookfield Real. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Brookfield Real Assets has no effect on the direction of Allianzgi Equity i.e., Allianzgi Equity and Brookfield Real go up and down completely randomly.

Pair Corralation between Allianzgi Equity and Brookfield Real

Considering the 90-day investment horizon Allianzgi Equity Convertible is expected to under-perform the Brookfield Real. In addition to that, Allianzgi Equity is 3.2 times more volatile than Brookfield Real Assets. It trades about -0.11 of its total potential returns per unit of risk. Brookfield Real Assets is currently generating about 0.07 per unit of volatility. If you would invest  1,298  in Brookfield Real Assets on December 29, 2024 and sell it today you would earn a total of  21.00  from holding Brookfield Real Assets or generate 1.62% return on investment over 90 days.

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

Allianzgi Equity Convertible  vs.  Brookfield Real Assets

Allianzgi Equity Con

Risk-Adjusted Performance

Very Weak

Over the last 90 days Allianzgi Equity Convertible has generated negative risk-adjusted returns adding no value to fund investors. In spite of latest inconsistent performance, the Fund's forward indicators remain sound and the latest tumult on Wall Street may also be a sign of longer-term gains for the fund shareholders.

Brookfield Real Assets

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Brookfield Real Assets are ranked lower than 5 (%) of all funds and portfolios of funds over the last 90 days. Despite somewhat strong basic indicators, Brookfield Real is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Allianzgi Equity and Brookfield Real

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

The idea behind Allianzgi Equity Convertible and Brookfield Real Assets 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.