Correlation Between Allianzgi Technology and Virtus Rampart

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

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

Diversification Opportunities for Allianzgi Technology and Virtus Rampart

-0.29

Correlation Coefficient

Allianzgi Technology  Virtus Rampart

Very good diversification

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

Pair Corralation between Allianzgi Technology and Virtus Rampart

Assuming the 90 days horizon Allianzgi Technology Fund is expected to generate 2.05 times more return on investment than Virtus Rampart. However, Allianzgi Technology is 2.05 times more volatile than Virtus Rampart Enhanced. It trades about 0.09 of its potential returns per unit of risk. Virtus Rampart Enhanced is currently generating about 0.04 per unit of risk. If you would invest  4,698  in Allianzgi Technology Fund on October 9, 2024 and sell it today you would earn a total of  1,698  from holding Allianzgi Technology Fund or generate 36.14% return on investment over 90 days.

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

Allianzgi Technology Fund  vs.  Virtus Rampart Enhanced

Allianzgi Technology

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Allianzgi Technology Fund are ranked lower than 9 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak basic indicators, Allianzgi Technology may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Virtus Rampart Enhanced

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Virtus Rampart Enhanced has generated negative risk-adjusted returns adding no value to fund investors. In spite of latest weak performance, the Fund's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the fund investors.

Pair Trading with Allianzgi Technology and Virtus Rampart

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

The idea behind Allianzgi Technology Fund and Virtus Rampart Enhanced 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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.