Correlation Between IA FINANCIAL and ALLIANZ SE
Can any of the company-specific risk be diversified away by investing in both IA FINANCIAL and ALLIANZ SE 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 IA FINANCIAL and ALLIANZ SE into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between IA FINANCIAL P and ALLIANZ SE UNSPADR, you can compare the effects of market volatilities on IA FINANCIAL and ALLIANZ SE 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 IA FINANCIAL with a short position of ALLIANZ SE. Check out your portfolio center. Please also check ongoing floating volatility patterns of IA FINANCIAL and ALLIANZ SE.
Diversification Opportunities for IA FINANCIAL and ALLIANZ SE
0.32 | Correlation Coefficient |
Weak diversification
The 3 months correlation between 1OD and ALLIANZ is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding IA FINANCIAL P and ALLIANZ SE UNSPADR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ALLIANZ SE UNSPADR and IA FINANCIAL 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 IA FINANCIAL P are associated (or correlated) with ALLIANZ SE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ALLIANZ SE UNSPADR has no effect on the direction of IA FINANCIAL i.e., IA FINANCIAL and ALLIANZ SE go up and down completely randomly.
Pair Corralation between IA FINANCIAL and ALLIANZ SE
Assuming the 90 days horizon IA FINANCIAL P is expected to generate 0.88 times more return on investment than ALLIANZ SE. However, IA FINANCIAL P is 1.13 times less risky than ALLIANZ SE. It trades about 0.12 of its potential returns per unit of risk. ALLIANZ SE UNSPADR is currently generating about 0.06 per unit of risk. If you would invest 5,804 in IA FINANCIAL P on August 25, 2024 and sell it today you would earn a total of 3,246 from holding IA FINANCIAL P or generate 55.93% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
IA FINANCIAL P vs. ALLIANZ SE UNSPADR
Performance |
| Timeline |
| IA FINANCIAL P |
| ALLIANZ SE UNSPADR |
IA FINANCIAL and ALLIANZ SE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with IA FINANCIAL and ALLIANZ SE
The main advantage of trading using opposite IA FINANCIAL and ALLIANZ SE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IA FINANCIAL position performs unexpectedly, ALLIANZ SE 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 ALLIANZ SE will offset losses from the drop in ALLIANZ SE's long position.| IA FINANCIAL vs. Allianz SE | IA FINANCIAL vs. ALLIANZ SE UNSPADR | IA FINANCIAL vs. AXA SA | IA FINANCIAL vs. ASSGENERALI ADR 12EO |
| ALLIANZ SE vs. Allianz SE | ALLIANZ SE vs. AXA SA | ALLIANZ SE vs. ASSGENERALI ADR 12EO | ALLIANZ SE vs. Principal Financial Group |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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