Correlation Between Allianzgi Health and Arbitrage Fund
Can any of the company-specific risk be diversified away by investing in both Allianzgi Health and Arbitrage Fund 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 Health and Arbitrage Fund into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Allianzgi Health Sciences and The Arbitrage Fund, you can compare the effects of market volatilities on Allianzgi Health and Arbitrage Fund 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 Health with a short position of Arbitrage Fund. Check out your portfolio center. Please also check ongoing floating volatility patterns of Allianzgi Health and Arbitrage Fund.
Diversification Opportunities for Allianzgi Health and Arbitrage Fund
-0.14 | Correlation Coefficient |
Good diversification
The 3 months correlation between Allianzgi and Arbitrage is -0.14. Overlapping area represents the amount of risk that can be diversified away by holding Allianzgi Health Sciences and The Arbitrage Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Arbitrage Fund and Allianzgi Health 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 Health Sciences are associated (or correlated) with Arbitrage Fund. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Arbitrage Fund has no effect on the direction of Allianzgi Health i.e., Allianzgi Health and Arbitrage Fund go up and down completely randomly.
Pair Corralation between Allianzgi Health and Arbitrage Fund
Assuming the 90 days horizon Allianzgi Health Sciences is expected to under-perform the Arbitrage Fund. In addition to that, Allianzgi Health is 3.57 times more volatile than The Arbitrage Fund. It trades about -0.16 of its total potential returns per unit of risk. The Arbitrage Fund is currently generating about 0.02 per unit of volatility. If you would invest 1,183 in The Arbitrage Fund on September 14, 2024 and sell it today you would earn a total of 3.00 from holding The Arbitrage Fund or generate 0.25% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Allianzgi Health Sciences vs. The Arbitrage Fund
Performance |
Timeline |
Allianzgi Health Sciences |
Arbitrage Fund |
Allianzgi Health and Arbitrage Fund Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Allianzgi Health and Arbitrage Fund
The main advantage of trading using opposite Allianzgi Health and Arbitrage Fund positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Allianzgi Health position performs unexpectedly, Arbitrage Fund 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 Arbitrage Fund will offset losses from the drop in Arbitrage Fund's long position.Allianzgi Health vs. Metropolitan West High | Allianzgi Health vs. Ab Global Risk | Allianzgi Health vs. California High Yield Municipal | Allianzgi Health vs. Needham Aggressive Growth |
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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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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