Correlation Between Allianzgi Health and Lkcm Fixed
Can any of the company-specific risk be diversified away by investing in both Allianzgi Health and Lkcm Fixed 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 Lkcm Fixed 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 Lkcm Fixed Income, you can compare the effects of market volatilities on Allianzgi Health and Lkcm Fixed 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 Lkcm Fixed. Check out your portfolio center. Please also check ongoing floating volatility patterns of Allianzgi Health and Lkcm Fixed.
Diversification Opportunities for Allianzgi Health and Lkcm Fixed
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Allianzgi and Lkcm is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Allianzgi Health Sciences and Lkcm Fixed Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lkcm Fixed Income 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 Lkcm Fixed. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lkcm Fixed Income has no effect on the direction of Allianzgi Health i.e., Allianzgi Health and Lkcm Fixed go up and down completely randomly.
Pair Corralation between Allianzgi Health and Lkcm Fixed
Assuming the 90 days horizon Allianzgi Health is expected to generate 1.8 times less return on investment than Lkcm Fixed. In addition to that, Allianzgi Health is 4.0 times more volatile than Lkcm Fixed Income. It trades about 0.01 of its total potential returns per unit of risk. Lkcm Fixed Income is currently generating about 0.08 per unit of volatility. If you would invest 975.00 in Lkcm Fixed Income on September 3, 2024 and sell it today you would earn a total of 75.00 from holding Lkcm Fixed Income or generate 7.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Allianzgi Health Sciences vs. Lkcm Fixed Income
Performance |
| Timeline |
| Allianzgi Health Sciences |
| Lkcm Fixed Income |
Allianzgi Health and Lkcm Fixed Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Allianzgi Health and Lkcm Fixed
The main advantage of trading using opposite Allianzgi Health and Lkcm Fixed positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Allianzgi Health position performs unexpectedly, Lkcm Fixed 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 Lkcm Fixed will offset losses from the drop in Lkcm Fixed's long position.| Allianzgi Health vs. Blackrock Health Sciences | Allianzgi Health vs. Fidelity Advisor Health | Allianzgi Health vs. Highland Longshort Healthcare | Allianzgi Health vs. Alphacentric Lifesci Healthcare |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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