Correlation Between Gemfields Group and ALLIANZ TECHNOTRLS
Can any of the company-specific risk be diversified away by investing in both Gemfields Group and ALLIANZ TECHNOTRLS 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 Gemfields Group and ALLIANZ TECHNOTRLS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Gemfields Group Limited and ALLIANZ TECHNOTRLS 025, you can compare the effects of market volatilities on Gemfields Group and ALLIANZ TECHNOTRLS 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 Gemfields Group with a short position of ALLIANZ TECHNOTRLS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gemfields Group and ALLIANZ TECHNOTRLS.
Diversification Opportunities for Gemfields Group and ALLIANZ TECHNOTRLS
-0.92 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Gemfields and ALLIANZ is -0.92. Overlapping area represents the amount of risk that can be diversified away by holding Gemfields Group Limited and ALLIANZ TECHNOTRLS 025 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ALLIANZ TECHNOTRLS 025 and Gemfields Group 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 Gemfields Group Limited are associated (or correlated) with ALLIANZ TECHNOTRLS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ALLIANZ TECHNOTRLS 025 has no effect on the direction of Gemfields Group i.e., Gemfields Group and ALLIANZ TECHNOTRLS go up and down completely randomly.
Pair Corralation between Gemfields Group and ALLIANZ TECHNOTRLS
Assuming the 90 days horizon Gemfields Group Limited is expected to under-perform the ALLIANZ TECHNOTRLS. In addition to that, Gemfields Group is 3.33 times more volatile than ALLIANZ TECHNOTRLS 025. It trades about -0.17 of its total potential returns per unit of risk. ALLIANZ TECHNOTRLS 025 is currently generating about 0.18 per unit of volatility. If you would invest 420.00 in ALLIANZ TECHNOTRLS 025 on September 24, 2024 and sell it today you would earn a total of 74.00 from holding ALLIANZ TECHNOTRLS 025 or generate 17.62% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
Gemfields Group Limited vs. ALLIANZ TECHNOTRLS 025
Performance |
Timeline |
Gemfields Group |
ALLIANZ TECHNOTRLS 025 |
Gemfields Group and ALLIANZ TECHNOTRLS Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Gemfields Group and ALLIANZ TECHNOTRLS
The main advantage of trading using opposite Gemfields Group and ALLIANZ TECHNOTRLS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gemfields Group position performs unexpectedly, ALLIANZ TECHNOTRLS 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 ALLIANZ TECHNOTRLS will offset losses from the drop in ALLIANZ TECHNOTRLS's long position.Gemfields Group vs. Fresnillo plc | Gemfields Group vs. NEW PACIFIC METALS | Gemfields Group vs. THARISA NON LIST | Gemfields Group vs. SYLVANIA PLAT DL |
ALLIANZ TECHNOTRLS vs. Fresnillo plc | ALLIANZ TECHNOTRLS vs. NEW PACIFIC METALS | ALLIANZ TECHNOTRLS vs. THARISA NON LIST | ALLIANZ TECHNOTRLS vs. SYLVANIA PLAT DL |
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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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