Correlation Between Allianz Technology and AstraZeneca PLC
Can any of the company-specific risk be diversified away by investing in both Allianz Technology and AstraZeneca PLC 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 Technology and AstraZeneca PLC into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Allianz Technology Trust and AstraZeneca PLC ADR, you can compare the effects of market volatilities on Allianz Technology and AstraZeneca PLC 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 Technology with a short position of AstraZeneca PLC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Allianz Technology and AstraZeneca PLC.
Diversification Opportunities for Allianz Technology and AstraZeneca PLC
-0.84 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Allianz and AstraZeneca is -0.84. Overlapping area represents the amount of risk that can be diversified away by holding Allianz Technology Trust and AstraZeneca PLC ADR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AstraZeneca PLC ADR and Allianz 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 Allianz Technology Trust are associated (or correlated) with AstraZeneca PLC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AstraZeneca PLC ADR has no effect on the direction of Allianz Technology i.e., Allianz Technology and AstraZeneca PLC go up and down completely randomly.
Pair Corralation between Allianz Technology and AstraZeneca PLC
Assuming the 90 days trading horizon Allianz Technology Trust is expected to generate 0.65 times more return on investment than AstraZeneca PLC. However, Allianz Technology Trust is 1.53 times less risky than AstraZeneca PLC. It trades about 0.15 of its potential returns per unit of risk. AstraZeneca PLC ADR is currently generating about -0.3 per unit of risk. If you would invest 37,900 in Allianz Technology Trust on August 26, 2024 and sell it today you would earn a total of 1,900 from holding Allianz Technology Trust or generate 5.01% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Allianz Technology Trust vs. AstraZeneca PLC ADR
Performance |
| Timeline |
| Allianz Technology Trust |
| AstraZeneca PLC ADR |
Allianz Technology and AstraZeneca PLC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Allianz Technology and AstraZeneca PLC
The main advantage of trading using opposite Allianz Technology and AstraZeneca PLC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Allianz Technology position performs unexpectedly, AstraZeneca PLC 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 AstraZeneca PLC will offset losses from the drop in AstraZeneca PLC's long position.| Allianz Technology vs. Catalyst Media Group | Allianz Technology vs. Oncimmune Holdings plc | Allianz Technology vs. Invesco Health Care | Allianz Technology vs. Coor Service Management |
| AstraZeneca PLC vs. Allianz Technology Trust | AstraZeneca PLC vs. Elmos Semiconductor SE | AstraZeneca PLC vs. Sunny Optical Technology | AstraZeneca PLC vs. Cognizant Technology Solutions |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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