Correlation Between Allianzgi Diversified and Franklin High
Can any of the company-specific risk be diversified away by investing in both Allianzgi Diversified and Franklin High 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 Allianzgi Diversified and Franklin High into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Allianzgi Diversified Income and Franklin High Yield, you can compare the effects of market volatilities on Allianzgi Diversified and Franklin High 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 Allianzgi Diversified with a short position of Franklin High. Check out your portfolio center. Please also check ongoing floating volatility patterns of Allianzgi Diversified and Franklin High.
Diversification Opportunities for Allianzgi Diversified and Franklin High
0.75 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Allianzgi and Franklin is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding Allianzgi Diversified Income and Franklin High Yield in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Franklin High Yield and Allianzgi Diversified 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 Allianzgi Diversified Income are associated (or correlated) with Franklin High. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Franklin High Yield has no effect on the direction of Allianzgi Diversified i.e., Allianzgi Diversified and Franklin High go up and down completely randomly.
Pair Corralation between Allianzgi Diversified and Franklin High
Assuming the 90 days horizon Allianzgi Diversified Income is expected to generate 3.12 times more return on investment than Franklin High. However, Allianzgi Diversified is 3.12 times more volatile than Franklin High Yield. It trades about 0.07 of its potential returns per unit of risk. Franklin High Yield is currently generating about 0.07 per unit of risk. If you would invest 2,179 in Allianzgi Diversified Income on October 30, 2024 and sell it today you would earn a total of 176.00 from holding Allianzgi Diversified Income or generate 8.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Allianzgi Diversified Income vs. Franklin High Yield
Performance |
| Timeline |
| Allianzgi Diversified |
| Franklin High Yield |
Allianzgi Diversified and Franklin High Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Allianzgi Diversified and Franklin High
The main advantage of trading using opposite Allianzgi Diversified and Franklin High positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Allianzgi Diversified position performs unexpectedly, Franklin High 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 Franklin High will offset losses from the drop in Franklin High's long position.| Allianzgi Diversified vs. Ambrus Core Bond | Allianzgi Diversified vs. Old Westbury Municipal | Allianzgi Diversified vs. Multisector Bond Sma | Allianzgi Diversified vs. Blrc Sgy Mnp |
| Franklin High vs. Needham Small Cap | Franklin High vs. Kinetics Small Cap | Franklin High vs. Hunter Small Cap | Franklin High vs. Astoncrosswind Small Cap |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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