Correlation Between Allianzgi Convertible and Nationwide Investor

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

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

Diversification Opportunities for Allianzgi Convertible and Nationwide Investor

-0.25

Correlation Coefficient

Allianzgi Convertible  Nationwide Investor

Very good diversification

The 3 months correlation between Allianzgi and Nationwide is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding Allianzgi Convertible Income and Nationwide Investor Destinatio in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nationwide Investor and Allianzgi Convertible 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 Convertible Income are associated (or correlated) with Nationwide Investor. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nationwide Investor has no effect on the direction of Allianzgi Convertible i.e., Allianzgi Convertible and Nationwide Investor go up and down completely randomly.

Pair Corralation between Allianzgi Convertible and Nationwide Investor

Assuming the 90 days horizon Allianzgi Convertible Income is expected to generate 89.54 times more return on investment than Nationwide Investor. However, Allianzgi Convertible is 89.54 times more volatile than Nationwide Investor Destinations. It trades about 0.16 of its potential returns per unit of risk. Nationwide Investor Destinations is currently generating about 0.03 per unit of risk. If you would invest  392.00  in Allianzgi Convertible Income on December 5, 2024 and sell it today you would earn a total of  1,127  from holding Allianzgi Convertible Income or generate 287.5% return on investment over 90 days.

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

Allianzgi Convertible Income  vs.  Nationwide Investor Destinatio

Allianzgi Convertible

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Allianzgi Convertible Income 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 Convertible showed solid returns over the last few months and may actually be approaching a breakup point.

Nationwide Investor

Risk-Adjusted Performance

Very Weak

Over the last 90 days Nationwide Investor Destinations has generated negative risk-adjusted returns adding no value to fund investors. In spite of latest weak performance, the Fund's primary 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 Convertible and Nationwide Investor

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

The idea behind Allianzgi Convertible Income and Nationwide Investor Destinations 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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.