Correlation Between Western Asset and Allianzgi Equity
Can any of the company-specific risk be diversified away by investing in both Western Asset 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 Western Asset and Allianzgi Equity into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Western Asset High and Allianzgi Equity Convertible, you can compare the effects of market volatilities on Western Asset 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 Western Asset with a short position of Allianzgi Equity. Check out your portfolio center. Please also check ongoing floating volatility patterns of Western Asset and Allianzgi Equity.
Diversification Opportunities for Western Asset and Allianzgi Equity
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Western and Allianzgi is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding Western Asset High 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 Western Asset 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 Western Asset High 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 Western Asset i.e., Western Asset and Allianzgi Equity go up and down completely randomly.
Pair Corralation between Western Asset and Allianzgi Equity
Considering the 90-day investment horizon Western Asset is expected to generate 2.11 times less return on investment than Allianzgi Equity. But when comparing it to its historical volatility, Western Asset High is 1.26 times less risky than Allianzgi Equity. It trades about 0.06 of its potential returns per unit of risk. Allianzgi Equity Convertible is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 1,583 in Allianzgi Equity Convertible on August 27, 2024 and sell it today you would earn a total of 830.00 from holding Allianzgi Equity Convertible or generate 52.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Western Asset High vs. Allianzgi Equity Convertible
Performance |
| Timeline |
| Western Asset High |
| Allianzgi Equity Con |
Western Asset and Allianzgi Equity Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Western Asset and Allianzgi Equity
The main advantage of trading using opposite Western Asset and Allianzgi Equity positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Western Asset 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.| Western Asset vs. Western Asset Global | Western Asset vs. Western Asset High | Western Asset vs. Voya Global Advantage | Western Asset vs. Voya Global Equity |
| 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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
Other Complementary Tools
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device |