Correlation Between Ambrus Core and Allianzgi Convertible

Can any of the company-specific risk be diversified away by investing in both Ambrus Core and Allianzgi Convertible 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 Ambrus Core and Allianzgi Convertible into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Ambrus Core Bond and Allianzgi Vertible Fund, you can compare the effects of market volatilities on Ambrus Core and Allianzgi Convertible 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 Ambrus Core with a short position of Allianzgi Convertible. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ambrus Core and Allianzgi Convertible.

Diversification Opportunities for Ambrus Core and Allianzgi Convertible

-0.58

Correlation Coefficient

Ambrus Core  Allianzgi Convertible

Excellent diversification

The 3 months correlation between Ambrus and Allianzgi is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding Ambrus Core Bond and Allianzgi Vertible Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Allianzgi Convertible and Ambrus Core 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 Ambrus Core Bond are associated (or correlated) with Allianzgi Convertible. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Allianzgi Convertible has no effect on the direction of Ambrus Core i.e., Ambrus Core and Allianzgi Convertible go up and down completely randomly.

Pair Corralation between Ambrus Core and Allianzgi Convertible

Assuming the 90 days horizon Ambrus Core is expected to generate 112.29 times less return on investment than Allianzgi Convertible. But when comparing it to its historical volatility, Ambrus Core Bond is 3.06 times less risky than Allianzgi Convertible. It trades about 0.01 of its potential returns per unit of risk. Allianzgi Vertible Fund is currently generating about 0.36 of returns per unit of risk over similar time horizon. If you would invest  3,439  in Allianzgi Vertible Fund on September 2, 2024 and sell it today you would earn a total of  443.00  from holding Allianzgi Vertible Fund or generate 12.88% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Ambrus Core Bond  vs.  Allianzgi Vertible Fund

Ambrus Core Bond

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Ambrus Core Bond has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong fundamental drivers, Ambrus Core is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

Allianzgi Convertible

Risk-Adjusted Performance

28 of 100

Strong

Compared to the overall equity markets, risk-adjusted returns on investments in Allianzgi Vertible Fund are ranked lower than 28 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak fundamental indicators, Allianzgi Convertible may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with Ambrus Core and Allianzgi Convertible

The main advantage of trading using opposite Ambrus Core and Allianzgi Convertible positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ambrus Core position performs unexpectedly, Allianzgi Convertible 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 Allianzgi Convertible will offset losses from the drop in Allianzgi Convertible's long position.

The idea behind Ambrus Core Bond and Allianzgi Vertible Fund pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.