Correlation Between AllianzIM Equity and Dow Jones

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both AllianzIM Equity and Dow Jones 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 AllianzIM Equity and Dow Jones into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AllianzIM Equity Buffer15 and Dow Jones Industrial, you can compare the effects of market volatilities on AllianzIM Equity and Dow Jones 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 AllianzIM Equity with a short position of Dow Jones. Check out your portfolio center. Please also check ongoing floating volatility patterns of AllianzIM Equity and Dow Jones.

Diversification Opportunities for AllianzIM Equity and Dow Jones

AllianzIMDowDiversified AwayAllianzIMDowDiversified Away100%
0.75
  Correlation Coefficient

Poor diversification

The 3 months correlation between AllianzIM and Dow is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding AllianzIM Equity Buffer15 and Dow Jones Industrial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dow Jones Industrial and AllianzIM Equity 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 AllianzIM Equity Buffer15 are associated (or correlated) with Dow Jones. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dow Jones Industrial has no effect on the direction of AllianzIM Equity i.e., AllianzIM Equity and Dow Jones go up and down completely randomly.
    Optimize

Pair Corralation between AllianzIM Equity and Dow Jones

Given the investment horizon of 90 days AllianzIM Equity Buffer15 is expected to generate 0.91 times more return on investment than Dow Jones. However, AllianzIM Equity Buffer15 is 1.1 times less risky than Dow Jones. It trades about -0.1 of its potential returns per unit of risk. Dow Jones Industrial is currently generating about -0.17 per unit of risk. If you would invest  2,653  in AllianzIM Equity Buffer15 on November 25, 2024 and sell it today you would lose (31.00) from holding AllianzIM Equity Buffer15 or give up 1.17% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthSignificant
Accuracy100.0%
ValuesDaily Returns

AllianzIM Equity Buffer15  vs.  Dow Jones Industrial

 Performance 
JavaScript chart by amCharts 3.21.15Dec2025Feb -3-2-10123
JavaScript chart by amCharts 3.21.15SEPU DJI
       Timeline  

AllianzIM Equity and Dow Jones Volatility Contrast

   Predicted Return Density   
JavaScript chart by amCharts 3.21.15-1.93-1.44-0.95-0.460.00.460.951.441.932.42 0.20.40.60.81.01.2
JavaScript chart by amCharts 3.21.15SEPU DJI
       Returns  

Pair Trading with AllianzIM Equity and Dow Jones

The main advantage of trading using opposite AllianzIM Equity and Dow Jones positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AllianzIM Equity position performs unexpectedly, Dow Jones 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 Dow Jones will offset losses from the drop in Dow Jones' long position.
The idea behind AllianzIM Equity Buffer15 and Dow Jones Industrial pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.

Other Complementary Tools

Equity Search
Search for actively traded equities including funds and ETFs from over 30 global markets
Money Managers
Screen money managers from public funds and ETFs managed around the world
Efficient Frontier
Plot and analyze your portfolio and positions against risk-return landscape of the market.
Volatility Analysis
Get historical volatility and risk analysis based on latest market data
Global Correlations
Find global opportunities by holding instruments from different markets