Correlation Between Allianz Technology and Alternative Income
Can any of the company-specific risk be diversified away by investing in both Allianz Technology and Alternative Income 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 Alternative Income 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 Alternative Income REIT, you can compare the effects of market volatilities on Allianz Technology and Alternative Income 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 Alternative Income. Check out your portfolio center. Please also check ongoing floating volatility patterns of Allianz Technology and Alternative Income.
Diversification Opportunities for Allianz Technology and Alternative Income
0.13 | Correlation Coefficient |
Average diversification
The 3 months correlation between Allianz and Alternative is 0.13. Overlapping area represents the amount of risk that can be diversified away by holding Allianz Technology Trust and Alternative Income REIT in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Alternative Income REIT 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 Alternative Income. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Alternative Income REIT has no effect on the direction of Allianz Technology i.e., Allianz Technology and Alternative Income go up and down completely randomly.
Pair Corralation between Allianz Technology and Alternative Income
Assuming the 90 days trading horizon Allianz Technology Trust is expected to generate 1.25 times more return on investment than Alternative Income. However, Allianz Technology is 1.25 times more volatile than Alternative Income REIT. It trades about 0.06 of its potential returns per unit of risk. Alternative Income REIT is currently generating about 0.04 per unit of risk. If you would invest 35,800 in Allianz Technology Trust on September 3, 2024 and sell it today you would earn a total of 4,400 from holding Allianz Technology Trust or generate 12.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Allianz Technology Trust vs. Alternative Income REIT
Performance |
| Timeline |
| Allianz Technology Trust |
| Alternative Income REIT |
Allianz Technology and Alternative Income Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Allianz Technology and Alternative Income
The main advantage of trading using opposite Allianz Technology and Alternative Income positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Allianz Technology position performs unexpectedly, Alternative Income 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 Alternative Income will offset losses from the drop in Alternative Income's long position.| Allianz Technology vs. Wheaton Precious Metals | Allianz Technology vs. Silvercorp Metals | Allianz Technology vs. Air Products Chemicals | Allianz Technology vs. Melia Hotels |
| Alternative Income vs. Europa Metals | Alternative Income vs. AMG Advanced Metallurgical | Alternative Income vs. GreenX Metals | Alternative Income vs. Empire Metals 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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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