Correlation Between Allianzgi Convertible and Sa Global

Can any of the company-specific risk be diversified away by investing in both Allianzgi Convertible and Sa Global 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 Sa Global 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 Sa Global Fixed, you can compare the effects of market volatilities on Allianzgi Convertible and Sa Global 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 Sa Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Allianzgi Convertible and Sa Global.

Diversification Opportunities for Allianzgi Convertible and Sa Global

0.81

Correlation Coefficient

Allianzgi Convertible  Sa Global

Very poor diversification

The 3 months correlation between Allianzgi and SAXIX is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding Allianzgi Convertible Income and Sa Global Fixed in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sa Global Fixed 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 Sa Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sa Global Fixed has no effect on the direction of Allianzgi Convertible i.e., Allianzgi Convertible and Sa Global go up and down completely randomly.

Pair Corralation between Allianzgi Convertible and Sa Global

Assuming the 90 days horizon Allianzgi Convertible Income is expected to generate 278.16 times more return on investment than Sa Global. However, Allianzgi Convertible is 278.16 times more volatile than Sa Global Fixed. It trades about 0.13 of its potential returns per unit of risk. Sa Global Fixed is currently generating about 0.17 per unit of risk. If you would invest  380.00  in Allianzgi Convertible Income on December 29, 2024 and sell it today you would earn a total of  1,082  from holding Allianzgi Convertible Income or generate 284.74% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Strong
Accuracy	98.39%
Values	Daily Returns

Allianzgi Convertible Income  vs.  Sa Global Fixed

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.

Sa Global Fixed

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Sa Global Fixed are ranked lower than 13 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong forward indicators, Sa Global is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Allianzgi Convertible and Sa Global

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

The idea behind Allianzgi Convertible Income and Sa Global Fixed 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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.