Correlation Between ALLIANZ SE and IA FINANCIAL

Can any of the company-specific risk be diversified away by investing in both ALLIANZ SE and IA FINANCIAL 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 ALLIANZ SE and IA FINANCIAL into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between ALLIANZ SE UNSPADR and IA FINANCIAL P, you can compare the effects of market volatilities on ALLIANZ SE and IA FINANCIAL 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 ALLIANZ SE with a short position of IA FINANCIAL. Check out your portfolio center. Please also check ongoing floating volatility patterns of ALLIANZ SE and IA FINANCIAL.

Diversification Opportunities for ALLIANZ SE and IA FINANCIAL

0.14

Correlation Coefficient

ALLIANZ SE  IA FINANCIAL

Average diversification

The 3 months correlation between ALLIANZ and 1OD is 0.14. Overlapping area represents the amount of risk that can be diversified away by holding ALLIANZ SE UNSPADR and IA FINANCIAL P in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on IA FINANCIAL P and ALLIANZ SE 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 ALLIANZ SE UNSPADR are associated (or correlated) with IA FINANCIAL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of IA FINANCIAL P has no effect on the direction of ALLIANZ SE i.e., ALLIANZ SE and IA FINANCIAL go up and down completely randomly.

Pair Corralation between ALLIANZ SE and IA FINANCIAL

Assuming the 90 days trading horizon ALLIANZ SE is expected to generate 5.99 times less return on investment than IA FINANCIAL. In addition to that, ALLIANZ SE is 1.15 times more volatile than IA FINANCIAL P. It trades about 0.03 of its total potential returns per unit of risk. IA FINANCIAL P is currently generating about 0.19 per unit of volatility. If you would invest  7,749  in IA FINANCIAL P on April 21, 2025 and sell it today you would earn a total of  1,301  from holding IA FINANCIAL P or generate 16.79% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

ALLIANZ SE UNSPADR  vs.  IA FINANCIAL P

ALLIANZ SE UNSPADR

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in ALLIANZ SE UNSPADR are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable basic indicators, ALLIANZ SE is not utilizing all of its potentials. The newest stock price disturbance, may contribute to mid-run losses for the stockholders.

IA FINANCIAL P

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in IA FINANCIAL P are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, IA FINANCIAL reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with ALLIANZ SE and IA FINANCIAL

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

The idea behind ALLIANZ SE UNSPADR and IA FINANCIAL P 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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.