Correlation Between Allianzgi Convertible and Catalyst Hedged
Can any of the company-specific risk be diversified away by investing in both Allianzgi Convertible and Catalyst Hedged 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 Catalyst Hedged 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 Catalyst Hedged Modity, you can compare the effects of market volatilities on Allianzgi Convertible and Catalyst Hedged 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 Catalyst Hedged. Check out your portfolio center. Please also check ongoing floating volatility patterns of Allianzgi Convertible and Catalyst Hedged.
Diversification Opportunities for Allianzgi Convertible and Catalyst Hedged
0.4 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Allianzgi and Catalyst is 0.4. Overlapping area represents the amount of risk that can be diversified away by holding Allianzgi Convertible Income and Catalyst Hedged Modity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Catalyst Hedged Modity 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 Catalyst Hedged. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Catalyst Hedged Modity has no effect on the direction of Allianzgi Convertible i.e., Allianzgi Convertible and Catalyst Hedged go up and down completely randomly.
Pair Corralation between Allianzgi Convertible and Catalyst Hedged
Assuming the 90 days horizon Allianzgi Convertible Income is expected to generate 0.81 times more return on investment than Catalyst Hedged. However, Allianzgi Convertible Income is 1.24 times less risky than Catalyst Hedged. It trades about 0.67 of its potential returns per unit of risk. Catalyst Hedged Modity is currently generating about 0.02 per unit of risk. If you would invest 375.00 in Allianzgi Convertible Income on September 4, 2024 and sell it today you would earn a total of 33.00 from holding Allianzgi Convertible Income or generate 8.8% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.24% |
| Values | Daily Returns |
Allianzgi Convertible Income vs. Catalyst Hedged Modity
Performance |
| Timeline |
| Allianzgi Convertible |
| Catalyst Hedged Modity |
Allianzgi Convertible and Catalyst Hedged Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Allianzgi Convertible and Catalyst Hedged
The main advantage of trading using opposite Allianzgi Convertible and Catalyst Hedged positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Allianzgi Convertible position performs unexpectedly, Catalyst Hedged 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 Catalyst Hedged will offset losses from the drop in Catalyst Hedged's long position.| Allianzgi Convertible vs. Vanguard Total Stock | Allianzgi Convertible vs. Vanguard 500 Index | Allianzgi Convertible vs. Vanguard Total Stock | Allianzgi Convertible vs. Vanguard Total Stock |
| Catalyst Hedged vs. Catalystsmh High Income | Catalyst Hedged vs. Catalystsmh High Income | Catalyst Hedged vs. Catalystsmh High Income | Catalyst Hedged vs. Catalyst Mlp Infrastructure |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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