Correlation Between AM EAGLE and Allianz SE
Can any of the company-specific risk be diversified away by investing in both AM EAGLE 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 AM EAGLE and Allianz SE into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AM EAGLE OUTFITTERS and Allianz SE VNA, you can compare the effects of market volatilities on AM EAGLE 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 AM EAGLE with a short position of Allianz SE. Check out your portfolio center. Please also check ongoing floating volatility patterns of AM EAGLE and Allianz SE.
Diversification Opportunities for AM EAGLE and Allianz SE
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between AFG and Allianz is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding AM EAGLE OUTFITTERS and Allianz SE VNA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Allianz SE VNA and AM EAGLE 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 AM EAGLE OUTFITTERS 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 VNA has no effect on the direction of AM EAGLE i.e., AM EAGLE and Allianz SE go up and down completely randomly.
Pair Corralation between AM EAGLE and Allianz SE
Assuming the 90 days trading horizon AM EAGLE is expected to generate 1.1 times less return on investment than Allianz SE. In addition to that, AM EAGLE is 2.74 times more volatile than Allianz SE VNA. It trades about 0.03 of its total potential returns per unit of risk. Allianz SE VNA is currently generating about 0.1 per unit of volatility. If you would invest 18,502 in Allianz SE VNA on September 3, 2024 and sell it today you would earn a total of 10,718 from holding Allianz SE VNA or generate 57.93% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
AM EAGLE OUTFITTERS vs. Allianz SE VNA
Performance |
| Timeline |
| AM EAGLE OUTFITTERS |
| Allianz SE VNA |
AM EAGLE and Allianz SE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AM EAGLE and Allianz SE
The main advantage of trading using opposite AM EAGLE and Allianz SE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AM EAGLE 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.| AM EAGLE vs. TOTAL GABON | AM EAGLE vs. Walgreens Boots Alliance | AM EAGLE vs. Banco Santander SA | AM EAGLE vs. Peak Resources Limited |
| Allianz SE vs. UNIVMUSIC GRPADR050 | Allianz SE vs. CeoTronics AG | Allianz SE vs. CVS Health | Allianz SE vs. Warner Music 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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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