Correlation Between Federated Premier and Allianzgi Equity
Can any of the company-specific risk be diversified away by investing in both Federated Premier and Allianzgi Equity 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 Federated Premier and Allianzgi Equity into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Federated Premier Municipal and Allianzgi Equity Convertible, you can compare the effects of market volatilities on Federated Premier and Allianzgi Equity 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 Federated Premier with a short position of Allianzgi Equity. Check out your portfolio center. Please also check ongoing floating volatility patterns of Federated Premier and Allianzgi Equity.
Diversification Opportunities for Federated Premier and Allianzgi Equity
-0.2 | Correlation Coefficient |
Good diversification
The 3 months correlation between Federated and Allianzgi is -0.2. Overlapping area represents the amount of risk that can be diversified away by holding Federated Premier Municipal and Allianzgi Equity Convertible in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Allianzgi Equity Con and Federated Premier 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 Federated Premier Municipal are associated (or correlated) with Allianzgi Equity. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Allianzgi Equity Con has no effect on the direction of Federated Premier i.e., Federated Premier and Allianzgi Equity go up and down completely randomly.
Pair Corralation between Federated Premier and Allianzgi Equity
Considering the 90-day investment horizon Federated Premier is expected to generate 3.74 times less return on investment than Allianzgi Equity. But when comparing it to its historical volatility, Federated Premier Municipal is 1.36 times less risky than Allianzgi Equity. It trades about 0.04 of its potential returns per unit of risk. Allianzgi Equity Convertible is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 1,573 in Allianzgi Equity Convertible on November 1, 2024 and sell it today you would earn a total of 925.00 from holding Allianzgi Equity Convertible or generate 58.8% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Federated Premier Municipal vs. Allianzgi Equity Convertible
Performance |
| Timeline |
| Federated Premier |
| Allianzgi Equity Con |
Federated Premier and Allianzgi Equity Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Federated Premier and Allianzgi Equity
The main advantage of trading using opposite Federated Premier and Allianzgi Equity positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Federated Premier position performs unexpectedly, Allianzgi Equity 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 Allianzgi Equity will offset losses from the drop in Allianzgi Equity's long position.| Federated Premier vs. MFS Investment Grade | Federated Premier vs. Eaton Vance Municipal | Federated Premier vs. DTF Tax Free |
| Allianzgi Equity vs. Rivernorth Opportunistic Municipalome | Allianzgi Equity vs. Blackrock Muni Intermediate | Allianzgi Equity vs. Blackrock Muniholdings Ny | Allianzgi Equity vs. Nuveen New York |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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