Correlation Between SMA Solar and Allianz Technology
Can any of the company-specific risk be diversified away by investing in both SMA Solar and Allianz Technology 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 SMA Solar and Allianz Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SMA Solar Technology and Allianz Technology Trust, you can compare the effects of market volatilities on SMA Solar and Allianz Technology 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 SMA Solar with a short position of Allianz Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of SMA Solar and Allianz Technology.
Diversification Opportunities for SMA Solar and Allianz Technology
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between SMA and Allianz is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding SMA Solar Technology and Allianz Technology Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Allianz Technology Trust and SMA Solar 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 SMA Solar Technology are associated (or correlated) with Allianz Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Allianz Technology Trust has no effect on the direction of SMA Solar i.e., SMA Solar and Allianz Technology go up and down completely randomly.
Pair Corralation between SMA Solar and Allianz Technology
Assuming the 90 days trading horizon SMA Solar Technology is expected to generate 2.49 times more return on investment than Allianz Technology. However, SMA Solar is 2.49 times more volatile than Allianz Technology Trust. It trades about 0.28 of its potential returns per unit of risk. Allianz Technology Trust is currently generating about 0.13 per unit of risk. If you would invest 1,630 in SMA Solar Technology on September 3, 2025 and sell it today you would earn a total of 1,691 from holding SMA Solar Technology or generate 103.74% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
SMA Solar Technology vs. Allianz Technology Trust
Performance |
| Timeline |
| SMA Solar Technology |
| Allianz Technology Trust |
SMA Solar and Allianz Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SMA Solar and Allianz Technology
The main advantage of trading using opposite SMA Solar and Allianz Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SMA Solar position performs unexpectedly, Allianz Technology 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 Technology will offset losses from the drop in Allianz Technology's long position.| SMA Solar vs. Rightmove PLC | SMA Solar vs. VeriSign | SMA Solar vs. Bioventix | SMA Solar vs. Sure Ventures PLC |
| Allianz Technology vs. Spire Healthcare Group | Allianz Technology vs. Bellevue Healthcare Trust | Allianz Technology vs. Gaztransport et Technigaz | Allianz Technology vs. Roadside Real Estate |
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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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