Correlation Between Queens Road and Allianzgi Focused

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

By analyzing existing cross correlation between Queens Road Small and Allianzgi Focused Growth, you can compare the effects of market volatilities on Queens Road and Allianzgi Focused 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 Queens Road with a short position of Allianzgi Focused. Check out your portfolio center. Please also check ongoing floating volatility patterns of Queens Road and Allianzgi Focused.

Diversification Opportunities for Queens Road and Allianzgi Focused

0.88

Correlation Coefficient

Queens Road  Allianzgi Focused

Very poor diversification

The 3 months correlation between Queens and Allianzgi is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Queens Road Small and Allianzgi Focused Growth in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Allianzgi Focused Growth and Queens Road 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 Queens Road Small are associated (or correlated) with Allianzgi Focused. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Allianzgi Focused Growth has no effect on the direction of Queens Road i.e., Queens Road and Allianzgi Focused go up and down completely randomly.

Pair Corralation between Queens Road and Allianzgi Focused

Assuming the 90 days horizon Queens Road Small is expected to generate 1.27 times more return on investment than Allianzgi Focused. However, Queens Road is 1.27 times more volatile than Allianzgi Focused Growth. It trades about 0.29 of its potential returns per unit of risk. Allianzgi Focused Growth is currently generating about 0.32 per unit of risk. If you would invest  4,013  in Queens Road Small on September 4, 2024 and sell it today you would earn a total of  338.00  from holding Queens Road Small or generate 8.42% return on investment over 90 days.

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

Queens Road Small  vs.  Allianzgi Focused Growth

Queens Road Small

Risk-Adjusted Performance

14 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Queens Road Small are ranked lower than 14 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak basic indicators, Queens Road may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Allianzgi Focused Growth

Risk-Adjusted Performance

16 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Allianzgi Focused Growth are ranked lower than 16 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak fundamental indicators, Allianzgi Focused showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Queens Road and Allianzgi Focused

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

The idea behind Queens Road Small and Allianzgi Focused Growth 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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.