Correlation Between Allianz Technology and Auction Technology
Can any of the company-specific risk be diversified away by investing in both Allianz Technology and Auction 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 Allianz Technology and Auction Technology 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 Auction Technology Group, you can compare the effects of market volatilities on Allianz Technology and Auction 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 Allianz Technology with a short position of Auction Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Allianz Technology and Auction Technology.
Diversification Opportunities for Allianz Technology and Auction Technology
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Allianz and Auction is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Allianz Technology Trust and Auction Technology Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Auction Technology 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 Auction Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Auction Technology has no effect on the direction of Allianz Technology i.e., Allianz Technology and Auction Technology go up and down completely randomly.
Pair Corralation between Allianz Technology and Auction Technology
Assuming the 90 days trading horizon Allianz Technology Trust is expected to generate 0.64 times more return on investment than Auction Technology. However, Allianz Technology Trust is 1.57 times less risky than Auction Technology. It trades about 0.08 of its potential returns per unit of risk. Auction Technology Group is currently generating about -0.02 per unit of risk. If you would invest 21,600 in Allianz Technology Trust on August 30, 2024 and sell it today you would earn a total of 17,800 from holding Allianz Technology Trust or generate 82.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 99.6% |
| Values | Daily Returns |
Allianz Technology Trust vs. Auction Technology Group
Performance |
| Timeline |
| Allianz Technology Trust |
| Auction Technology |
Allianz Technology and Auction Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Allianz Technology and Auction Technology
The main advantage of trading using opposite Allianz Technology and Auction Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Allianz Technology position performs unexpectedly, Auction 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 Auction Technology will offset losses from the drop in Auction Technology's long position.| Allianz Technology vs. Toyota Motor Corp | Allianz Technology vs. Neometals | Allianz Technology vs. Coor Service Management | Allianz Technology vs. Jupiter Fund Management |
| Auction Technology vs. Samsung Electronics Co | Auction Technology vs. Samsung Electronics Co | Auction Technology vs. Toyota Motor Corp | Auction Technology vs. Reliance Industries Ltd |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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