Correlation Between Allianzgi International and Lgm Risk
Can any of the company-specific risk be diversified away by investing in both Allianzgi International and Lgm Risk 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 International and Lgm Risk into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Allianzgi International Small Cap and Lgm Risk Managed, you can compare the effects of market volatilities on Allianzgi International and Lgm Risk 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 International with a short position of Lgm Risk. Check out your portfolio center. Please also check ongoing floating volatility patterns of Allianzgi International and Lgm Risk.
Diversification Opportunities for Allianzgi International and Lgm Risk
-0.53 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Allianzgi and Lgm is -0.53. Overlapping area represents the amount of risk that can be diversified away by holding Allianzgi International Small and Lgm Risk Managed in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lgm Risk Managed and Allianzgi International 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 International Small Cap are associated (or correlated) with Lgm Risk. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lgm Risk Managed has no effect on the direction of Allianzgi International i.e., Allianzgi International and Lgm Risk go up and down completely randomly.
Pair Corralation between Allianzgi International and Lgm Risk
Assuming the 90 days horizon Allianzgi International Small Cap is expected to under-perform the Lgm Risk. In addition to that, Allianzgi International is 2.2 times more volatile than Lgm Risk Managed. It trades about -0.03 of its total potential returns per unit of risk. Lgm Risk Managed is currently generating about 0.21 per unit of volatility. If you would invest 1,109 in Lgm Risk Managed on September 4, 2024 and sell it today you would earn a total of 42.00 from holding Lgm Risk Managed or generate 3.79% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 98.44% |
| Values | Daily Returns |
Allianzgi International Small vs. Lgm Risk Managed
Performance |
| Timeline |
| Allianzgi International |
| Lgm Risk Managed |
Allianzgi International and Lgm Risk Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Allianzgi International and Lgm Risk
The main advantage of trading using opposite Allianzgi International and Lgm Risk positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Allianzgi International position performs unexpectedly, Lgm Risk 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 Lgm Risk will offset losses from the drop in Lgm Risk's long position.| Allianzgi International vs. Lgm Risk Managed | Allianzgi International vs. Guggenheim High Yield | Allianzgi International vs. Ab High Income | Allianzgi International vs. Ab Global Risk |
| Lgm Risk vs. Fuller Thaler Behavioral | Lgm Risk vs. The Gabelli Small | Lgm Risk vs. Davenport Small Cap | Lgm Risk vs. Northern Small Cap |
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 Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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