Correlation Between Allianzgi Health and Westcore Municipal
Can any of the company-specific risk be diversified away by investing in both Allianzgi Health and Westcore Municipal 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 Westcore Municipal 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 Westcore Municipal Opportunities, you can compare the effects of market volatilities on Allianzgi Health and Westcore Municipal 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 Westcore Municipal. Check out your portfolio center. Please also check ongoing floating volatility patterns of Allianzgi Health and Westcore Municipal.
Diversification Opportunities for Allianzgi Health and Westcore Municipal
0.55 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Allianzgi and Westcore is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding Allianzgi Health Sciences and Westcore Municipal Opportuniti in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Westcore Municipal 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 Westcore Municipal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Westcore Municipal has no effect on the direction of Allianzgi Health i.e., Allianzgi Health and Westcore Municipal go up and down completely randomly.
Pair Corralation between Allianzgi Health and Westcore Municipal
Assuming the 90 days horizon Allianzgi Health Sciences is expected to under-perform the Westcore Municipal. In addition to that, Allianzgi Health is 6.96 times more volatile than Westcore Municipal Opportunities. It trades about -0.11 of its total potential returns per unit of risk. Westcore Municipal Opportunities is currently generating about 0.25 per unit of volatility. If you would invest 967.00 in Westcore Municipal Opportunities on September 12, 2024 and sell it today you would earn a total of 7.00 from holding Westcore Municipal Opportunities or generate 0.72% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Allianzgi Health Sciences vs. Westcore Municipal Opportuniti
Performance |
| Timeline |
| Allianzgi Health Sciences |
| Westcore Municipal |
Allianzgi Health and Westcore Municipal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Allianzgi Health and Westcore Municipal
The main advantage of trading using opposite Allianzgi Health and Westcore Municipal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Allianzgi Health position performs unexpectedly, Westcore Municipal 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 Westcore Municipal will offset losses from the drop in Westcore Municipal's long position.| Allianzgi Health vs. Payden High Income | Allianzgi Health vs. City National Rochdale | Allianzgi Health vs. Virtus High Yield | Allianzgi Health vs. Buffalo High Yield |
| Westcore Municipal vs. Vanguard Small Cap Value | Westcore Municipal vs. Fidelity Small Cap | Westcore Municipal vs. Omni Small Cap Value | Westcore Municipal vs. Amg River Road |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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