Correlation Between Allianzgi Convertible and American Beacon
Can any of the company-specific risk be diversified away by investing in both Allianzgi Convertible and American Beacon 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 Convertible and American Beacon into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Allianzgi Convertible Income and American Beacon Large, you can compare the effects of market volatilities on Allianzgi Convertible and American Beacon 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 Convertible with a short position of American Beacon. Check out your portfolio center. Please also check ongoing floating volatility patterns of Allianzgi Convertible and American Beacon.
Diversification Opportunities for Allianzgi Convertible and American Beacon
0.94 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Allianzgi and American is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding Allianzgi Convertible Income and American Beacon Large in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on American Beacon Large and Allianzgi Convertible 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 Convertible Income are associated (or correlated) with American Beacon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of American Beacon Large has no effect on the direction of Allianzgi Convertible i.e., Allianzgi Convertible and American Beacon go up and down completely randomly.
Pair Corralation between Allianzgi Convertible and American Beacon
Assuming the 90 days horizon Allianzgi Convertible Income is expected to generate 0.78 times more return on investment than American Beacon. However, Allianzgi Convertible Income is 1.28 times less risky than American Beacon. It trades about 0.67 of its potential returns per unit of risk. American Beacon Large is currently generating about 0.29 per unit of risk. If you would invest 374.00 in Allianzgi Convertible Income on September 1, 2024 and sell it today you would earn a total of 34.00 from holding Allianzgi Convertible Income or generate 9.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 95.45% |
| Values | Daily Returns |
Allianzgi Convertible Income vs. American Beacon Large
Performance |
| Timeline |
| Allianzgi Convertible |
| American Beacon Large |
Allianzgi Convertible and American Beacon Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Allianzgi Convertible and American Beacon
The main advantage of trading using opposite Allianzgi Convertible and American Beacon positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Allianzgi Convertible position performs unexpectedly, American Beacon 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 American Beacon will offset losses from the drop in American Beacon's long position.| Allianzgi Convertible vs. Cutler Equity | Allianzgi Convertible vs. Calamos Global Equity | Allianzgi Convertible vs. Us Strategic Equity | Allianzgi Convertible vs. Scharf Fund Retail |
| American Beacon vs. American Beacon Ssi | American Beacon vs. American Beacon Bridgeway | American Beacon vs. American Beacon Bridgeway | American Beacon vs. American Beacon Twentyfour |
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 Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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