Correlation Between California Bond and Allianzgi Convertible
Can any of the company-specific risk be diversified away by investing in both California Bond and Allianzgi Convertible 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 Convertible 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 Convertible Income, you can compare the effects of market volatilities on California Bond and Allianzgi Convertible 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 Convertible. Check out your portfolio center. Please also check ongoing floating volatility patterns of California Bond and Allianzgi Convertible.
Diversification Opportunities for California Bond and Allianzgi Convertible
0.63 | Correlation Coefficient |
Poor diversification
The 3 months correlation between California and Allianzgi is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding California Bond Fund and Allianzgi Convertible Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Allianzgi Convertible 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 Convertible. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Allianzgi Convertible has no effect on the direction of California Bond i.e., California Bond and Allianzgi Convertible go up and down completely randomly.
Pair Corralation between California Bond and Allianzgi Convertible
Assuming the 90 days horizon California Bond is expected to generate 258.5 times less return on investment than Allianzgi Convertible. But when comparing it to its historical volatility, California Bond Fund is 2.83 times less risky than Allianzgi Convertible. It trades about 0.0 of its potential returns per unit of risk. Allianzgi Convertible Income is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest 312.00 in Allianzgi Convertible Income on October 26, 2024 and sell it today you would earn a total of 41.00 from holding Allianzgi Convertible Income or generate 13.14% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
California Bond Fund vs. Allianzgi Convertible Income
Performance |
| Timeline |
| California Bond |
| Allianzgi Convertible |
California Bond and Allianzgi Convertible Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with California Bond and Allianzgi Convertible
The main advantage of trading using opposite California Bond and Allianzgi Convertible positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if California Bond position performs unexpectedly, Allianzgi Convertible 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 Convertible will offset losses from the drop in Allianzgi Convertible's long position.| California Bond vs. Large Cap Growth Profund | California Bond vs. Tiaa Cref Large Cap Value | California Bond vs. Ab Large Cap | California Bond vs. Blackrock Large Cap |
| Allianzgi Convertible vs. Ambrus Core Bond | Allianzgi Convertible vs. Morningstar Defensive Bond | Allianzgi Convertible vs. California Bond Fund | Allianzgi Convertible vs. Gmo High Yield |
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 CEOs Directory module to screen CEOs from public companies around the world.
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