Correlation Between California Bond and Allianzgi Emerging
Can any of the company-specific risk be diversified away by investing in both California Bond and Allianzgi Emerging 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 California Bond and Allianzgi Emerging into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between California Bond Fund and Allianzgi Emerging Markets, you can compare the effects of market volatilities on California Bond and Allianzgi Emerging 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 California Bond with a short position of Allianzgi Emerging. Check out your portfolio center. Please also check ongoing floating volatility patterns of California Bond and Allianzgi Emerging.
Diversification Opportunities for California Bond and Allianzgi Emerging
0.44 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between California and Allianzgi is 0.44. Overlapping area represents the amount of risk that can be diversified away by holding California Bond Fund and Allianzgi Emerging Markets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Allianzgi Emerging and California Bond 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 California Bond Fund are associated (or correlated) with Allianzgi Emerging. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Allianzgi Emerging has no effect on the direction of California Bond i.e., California Bond and Allianzgi Emerging go up and down completely randomly.
Pair Corralation between California Bond and Allianzgi Emerging
Assuming the 90 days horizon California Bond Fund is expected to generate 0.38 times more return on investment than Allianzgi Emerging. However, California Bond Fund is 2.64 times less risky than Allianzgi Emerging. It trades about 0.1 of its potential returns per unit of risk. Allianzgi Emerging Markets is currently generating about -0.06 per unit of risk. If you would invest 1,028 in California Bond Fund on November 27, 2024 and sell it today you would earn a total of 5.00 from holding California Bond Fund or generate 0.49% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.24% |
| Values | Daily Returns |
California Bond Fund vs. Allianzgi Emerging Markets
Performance |
| Timeline |
| California Bond |
| Allianzgi Emerging |
California Bond and Allianzgi Emerging Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with California Bond and Allianzgi Emerging
The main advantage of trading using opposite California Bond and Allianzgi Emerging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if California Bond position performs unexpectedly, Allianzgi Emerging 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 Emerging will offset losses from the drop in Allianzgi Emerging's long position.| California Bond vs. Federated Government Income | California Bond vs. Us Government Securities | California Bond vs. Dunham Porategovernment Bond | California Bond vs. John Hancock Government |
| Allianzgi Emerging vs. Oil Gas Ultrasector | Allianzgi Emerging vs. Franklin Natural Resources | Allianzgi Emerging vs. Short Oil Gas | Allianzgi Emerging vs. Gamco Natural Resources |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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