Correlation Between Allianzgi Health and American Beacon
Can any of the company-specific risk be diversified away by investing in both Allianzgi Health and American Beacon 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 Allianzgi Health and American Beacon into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Allianzgi Health Sciences and American Beacon Bridgeway, you can compare the effects of market volatilities on Allianzgi Health and American Beacon 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 Allianzgi Health with a short position of American Beacon. Check out your portfolio center. Please also check ongoing floating volatility patterns of Allianzgi Health and American Beacon.
Diversification Opportunities for Allianzgi Health and American Beacon
0.47 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Allianzgi and American is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding Allianzgi Health Sciences and American Beacon Bridgeway in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on American Beacon Bridgeway and Allianzgi Health 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 Allianzgi Health Sciences are associated (or correlated) with American Beacon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of American Beacon Bridgeway has no effect on the direction of Allianzgi Health i.e., Allianzgi Health and American Beacon go up and down completely randomly.
Pair Corralation between Allianzgi Health and American Beacon
Assuming the 90 days horizon Allianzgi Health Sciences is expected to generate 0.79 times more return on investment than American Beacon. However, Allianzgi Health Sciences is 1.27 times less risky than American Beacon. It trades about 0.35 of its potential returns per unit of risk. American Beacon Bridgeway is currently generating about 0.21 per unit of risk. If you would invest 2,766 in Allianzgi Health Sciences on November 2, 2024 and sell it today you would earn a total of 162.00 from holding Allianzgi Health Sciences or generate 5.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Allianzgi Health Sciences vs. American Beacon Bridgeway
Performance |
| Timeline |
| Allianzgi Health Sciences |
| American Beacon Bridgeway |
Allianzgi Health and American Beacon Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Allianzgi Health and American Beacon
The main advantage of trading using opposite Allianzgi Health and American Beacon positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Allianzgi Health position performs unexpectedly, American Beacon 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 American Beacon will offset losses from the drop in American Beacon's long position.| Allianzgi Health vs. Tfa Quantitative | Allianzgi Health vs. T Rowe Price | Allianzgi Health vs. Credit Suisse Floating | Allianzgi Health vs. Dgi Investment Trust |
| American Beacon vs. Inverse Government Long | American Beacon vs. Schwab Government Money | American Beacon vs. Sit Government Securities | American Beacon vs. Blackrock Government Bond |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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