Correlation Between Tekla Healthcare and Allianzgi Equity
Can any of the company-specific risk be diversified away by investing in both Tekla Healthcare and Allianzgi Equity 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 Tekla Healthcare and Allianzgi Equity into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Tekla Healthcare Opportunities and Allianzgi Equity Convertible, you can compare the effects of market volatilities on Tekla Healthcare and Allianzgi Equity 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 Tekla Healthcare with a short position of Allianzgi Equity. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tekla Healthcare and Allianzgi Equity.
Diversification Opportunities for Tekla Healthcare and Allianzgi Equity
-0.38 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Tekla and Allianzgi is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding Tekla Healthcare Opportunities and Allianzgi Equity Convertible in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Allianzgi Equity Con and Tekla Healthcare 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 Tekla Healthcare Opportunities are associated (or correlated) with Allianzgi Equity. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Allianzgi Equity Con has no effect on the direction of Tekla Healthcare i.e., Tekla Healthcare and Allianzgi Equity go up and down completely randomly.
Pair Corralation between Tekla Healthcare and Allianzgi Equity
Considering the 90-day investment horizon Tekla Healthcare is expected to generate 1.5 times less return on investment than Allianzgi Equity. In addition to that, Tekla Healthcare is 1.22 times more volatile than Allianzgi Equity Convertible. It trades about 0.07 of its total potential returns per unit of risk. Allianzgi Equity Convertible is currently generating about 0.13 per unit of volatility. If you would invest 2,147 in Allianzgi Equity Convertible on September 1, 2024 and sell it today you would earn a total of 312.00 from holding Allianzgi Equity Convertible or generate 14.53% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Tekla Healthcare Opportunities vs. Allianzgi Equity Convertible
Performance |
| Timeline |
| Tekla Healthcare Opp |
| Allianzgi Equity Con |
Tekla Healthcare and Allianzgi Equity Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tekla Healthcare and Allianzgi Equity
The main advantage of trading using opposite Tekla Healthcare and Allianzgi Equity positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tekla Healthcare position performs unexpectedly, Allianzgi Equity 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 Equity will offset losses from the drop in Allianzgi Equity's long position.| Tekla Healthcare vs. Tekla Healthcare Investors | Tekla Healthcare vs. Tekla Life Sciences | Tekla Healthcare vs. Cohen Steers Reit | Tekla Healthcare vs. XAI Octagon Floating |
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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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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