Correlation Between Auction Technology and Allianz Technology
Can any of the company-specific risk be diversified away by investing in both Auction Technology and Allianz Technology 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 Auction Technology and Allianz Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Auction Technology Group and Allianz Technology Trust, you can compare the effects of market volatilities on Auction Technology and Allianz Technology 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 Auction Technology with a short position of Allianz Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Auction Technology and Allianz Technology.
Diversification Opportunities for Auction Technology and Allianz Technology
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Auction and Allianz is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Auction Technology Group and Allianz Technology Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Allianz Technology Trust and Auction Technology 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 Auction Technology Group are associated (or correlated) with Allianz Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Allianz Technology Trust has no effect on the direction of Auction Technology i.e., Auction Technology and Allianz Technology go up and down completely randomly.
Pair Corralation between Auction Technology and Allianz Technology
Assuming the 90 days trading horizon Auction Technology Group is expected to generate 1.22 times more return on investment than Allianz Technology. However, Auction Technology is 1.22 times more volatile than Allianz Technology Trust. It trades about 0.24 of its potential returns per unit of risk. Allianz Technology Trust is currently generating about 0.13 per unit of risk. If you would invest 55,400 in Auction Technology Group on November 3, 2024 and sell it today you would earn a total of 6,400 from holding Auction Technology Group or generate 11.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Auction Technology Group vs. Allianz Technology Trust
Performance |
| Timeline |
| Auction Technology |
| Allianz Technology Trust |
Auction Technology and Allianz Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Auction Technology and Allianz Technology
The main advantage of trading using opposite Auction Technology and Allianz Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Auction Technology position performs unexpectedly, Allianz Technology 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 Technology will offset losses from the drop in Allianz Technology's long position.| Auction Technology vs. Games Workshop Group | Auction Technology vs. Fulcrum Metals PLC | Auction Technology vs. Hochschild Mining plc | Auction Technology vs. CleanTech Lithium plc |
| Allianz Technology vs. Air Products Chemicals | Allianz Technology vs. Gruppo MutuiOnline SpA | Allianz Technology vs. Waste Management | Allianz Technology vs. Amedeo Air Four |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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