Correlation Between Allianz Technology and Neometals
Can any of the company-specific risk be diversified away by investing in both Allianz Technology and Neometals 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 Neometals 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 Neometals, you can compare the effects of market volatilities on Allianz Technology and Neometals 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 Neometals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Allianz Technology and Neometals.
Diversification Opportunities for Allianz Technology and Neometals
-0.07 | Correlation Coefficient |
Good diversification
The 3 months correlation between Allianz and Neometals is -0.07. Overlapping area represents the amount of risk that can be diversified away by holding Allianz Technology Trust and Neometals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Neometals 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 Neometals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Neometals has no effect on the direction of Allianz Technology i.e., Allianz Technology and Neometals go up and down completely randomly.
Pair Corralation between Allianz Technology and Neometals
Assuming the 90 days trading horizon Allianz Technology Trust is expected to generate 1.45 times more return on investment than Neometals. However, Allianz Technology is 1.45 times more volatile than Neometals. It trades about 0.21 of its potential returns per unit of risk. Neometals is currently generating about -0.21 per unit of risk. If you would invest 37,700 in Allianz Technology Trust on August 29, 2024 and sell it today you would earn a total of 2,800 from holding Allianz Technology Trust or generate 7.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Allianz Technology Trust vs. Neometals
Performance |
| Timeline |
| Allianz Technology Trust |
| Neometals |
Allianz Technology and Neometals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Allianz Technology and Neometals
The main advantage of trading using opposite Allianz Technology and Neometals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Allianz Technology position performs unexpectedly, Neometals 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 Neometals will offset losses from the drop in Neometals' long position.| Allianz Technology vs. Toyota Motor Corp | Allianz Technology vs. Lendinvest PLC | Allianz Technology vs. Neometals | Allianz Technology vs. Coor Service Management |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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