Correlation Between ALLIANZ SE and Equitable Holdings
Can any of the company-specific risk be diversified away by investing in both ALLIANZ SE and Equitable Holdings 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 Equitable Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ALLIANZ SE UNSPADR and Equitable Holdings, you can compare the effects of market volatilities on ALLIANZ SE and Equitable Holdings 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 Equitable Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of ALLIANZ SE and Equitable Holdings.
Diversification Opportunities for ALLIANZ SE and Equitable Holdings
0.26 | Correlation Coefficient |
Modest diversification
The 3 months correlation between ALLIANZ and Equitable is 0.26. Overlapping area represents the amount of risk that can be diversified away by holding ALLIANZ SE UNSPADR and Equitable Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Equitable Holdings 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 UNSPADR are associated (or correlated) with Equitable Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Equitable Holdings has no effect on the direction of ALLIANZ SE i.e., ALLIANZ SE and Equitable Holdings go up and down completely randomly.
Pair Corralation between ALLIANZ SE and Equitable Holdings
Assuming the 90 days trading horizon ALLIANZ SE is expected to generate 1.56 times less return on investment than Equitable Holdings. In addition to that, ALLIANZ SE is 1.09 times more volatile than Equitable Holdings. It trades about 0.06 of its total potential returns per unit of risk. Equitable Holdings is currently generating about 0.11 per unit of volatility. If you would invest 2,940 in Equitable Holdings on August 25, 2024 and sell it today you would earn a total of 1,460 from holding Equitable Holdings or generate 49.66% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
ALLIANZ SE UNSPADR vs. Equitable Holdings
Performance |
| Timeline |
| ALLIANZ SE UNSPADR |
| Equitable Holdings |
ALLIANZ SE and Equitable Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ALLIANZ SE and Equitable Holdings
The main advantage of trading using opposite ALLIANZ SE and Equitable Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ALLIANZ SE position performs unexpectedly, Equitable Holdings 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 Equitable Holdings will offset losses from the drop in Equitable Holdings' long position.| ALLIANZ SE vs. Allianz SE | ALLIANZ SE vs. AXA SA | ALLIANZ SE vs. ASSGENERALI ADR 12EO | ALLIANZ SE vs. Principal Financial Group |
| Equitable Holdings vs. Allianz SE | Equitable Holdings vs. ALLIANZ SE UNSPADR | Equitable Holdings vs. AXA SA | Equitable Holdings vs. ASSGENERALI ADR 12EO |
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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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