Correlation Between Nasdaq-100(r) and Allianzgi Technology
Can any of the company-specific risk be diversified away by investing in both Nasdaq-100(r) and Allianzgi Technology 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 Nasdaq-100(r) and Allianzgi Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nasdaq 100 2x Strategy and Allianzgi Technology Fund, you can compare the effects of market volatilities on Nasdaq-100(r) and Allianzgi Technology 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 Nasdaq-100(r) with a short position of Allianzgi Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nasdaq-100(r) and Allianzgi Technology.
Diversification Opportunities for Nasdaq-100(r) and Allianzgi Technology
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Nasdaq-100(r) and Allianzgi is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Nasdaq 100 2x Strategy and Allianzgi Technology Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Allianzgi Technology and Nasdaq-100(r) 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 Nasdaq 100 2x Strategy are associated (or correlated) with Allianzgi Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Allianzgi Technology has no effect on the direction of Nasdaq-100(r) i.e., Nasdaq-100(r) and Allianzgi Technology go up and down completely randomly.
Pair Corralation between Nasdaq-100(r) and Allianzgi Technology
Assuming the 90 days horizon Nasdaq 100 2x Strategy is expected to under-perform the Allianzgi Technology. In addition to that, Nasdaq-100(r) is 1.44 times more volatile than Allianzgi Technology Fund. It trades about -0.02 of its total potential returns per unit of risk. Allianzgi Technology Fund is currently generating about -0.01 per unit of volatility. If you would invest 6,345 in Allianzgi Technology Fund on October 30, 2024 and sell it today you would lose (46.00) from holding Allianzgi Technology Fund or give up 0.72% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nasdaq 100 2x Strategy vs. Allianzgi Technology Fund
Performance |
| Timeline |
| Nasdaq 100 2x |
| Allianzgi Technology |
Nasdaq-100(r) and Allianzgi Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nasdaq-100(r) and Allianzgi Technology
The main advantage of trading using opposite Nasdaq-100(r) and Allianzgi Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nasdaq-100(r) position performs unexpectedly, Allianzgi Technology 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 Technology will offset losses from the drop in Allianzgi Technology's long position.| Nasdaq-100(r) vs. Sp 500 2x | Nasdaq-100(r) vs. Inverse Nasdaq 100 2x | Nasdaq-100(r) vs. Inverse Sp 500 | Nasdaq-100(r) vs. Ultra Nasdaq 100 Profunds |
| Allianzgi Technology vs. Franklin Government Money | Allianzgi Technology vs. Pioneer Money Market | Allianzgi Technology vs. Elfun Government Money | Allianzgi Technology vs. Ab Government Exchange |
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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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