Correlation Between Allianz SE and Baldwin Insurance
Can any of the company-specific risk be diversified away by investing in both Allianz SE and Baldwin Insurance 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 Allianz SE and Baldwin Insurance into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Allianz SE ADR and The Baldwin Insurance, you can compare the effects of market volatilities on Allianz SE and Baldwin Insurance 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 Allianz SE with a short position of Baldwin Insurance. Check out your portfolio center. Please also check ongoing floating volatility patterns of Allianz SE and Baldwin Insurance.
Diversification Opportunities for Allianz SE and Baldwin Insurance
-0.55 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Allianz and Baldwin is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding Allianz SE ADR and The Baldwin Insurance in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Baldwin Insurance and Allianz SE 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 Allianz SE ADR are associated (or correlated) with Baldwin Insurance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Baldwin Insurance has no effect on the direction of Allianz SE i.e., Allianz SE and Baldwin Insurance go up and down completely randomly.
Pair Corralation between Allianz SE and Baldwin Insurance
If you would invest 2,379 in Allianz SE ADR on August 28, 2024 and sell it today you would earn a total of 0.00 from holding Allianz SE ADR or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 4.76% |
| Values | Daily Returns |
Allianz SE ADR vs. The Baldwin Insurance
Performance |
| Timeline |
| Allianz SE ADR |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Baldwin Insurance |
Allianz SE and Baldwin Insurance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Allianz SE and Baldwin Insurance
The main advantage of trading using opposite Allianz SE and Baldwin Insurance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Allianz SE position performs unexpectedly, Baldwin Insurance 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 Baldwin Insurance will offset losses from the drop in Baldwin Insurance's long position.| Allianz SE vs. Allianz SE | Allianz SE vs. Muenchener Rueckver Ges | Allianz SE vs. Zurich Insurance Group | Allianz SE vs. Legal General Group |
| Baldwin Insurance vs. Paiute Oil Mining | Baldwin Insurance vs. Minerals Technologies | Baldwin Insurance vs. Parker Hannifin | Baldwin Insurance vs. Highway Holdings Limited |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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