Correlation Between American Tower and Allianzgi International

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

By analyzing existing cross correlation between American Tower Corp and Allianzgi International Small Cap, you can compare the effects of market volatilities on American Tower and Allianzgi International 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 American Tower with a short position of Allianzgi International. Check out your portfolio center. Please also check ongoing floating volatility patterns of American Tower and Allianzgi International.

Diversification Opportunities for American Tower and Allianzgi International

0.36

Correlation Coefficient

American Tower  Allianzgi International

Weak diversification

The 3 months correlation between American and Allianzgi is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding American Tower Corp and Allianzgi International Small in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Allianzgi International and American Tower 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 American Tower Corp are associated (or correlated) with Allianzgi International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Allianzgi International has no effect on the direction of American Tower i.e., American Tower and Allianzgi International go up and down completely randomly.

Pair Corralation between American Tower and Allianzgi International

Considering the 90-day investment horizon American Tower Corp is expected to under-perform the Allianzgi International. In addition to that, American Tower is 2.64 times more volatile than Allianzgi International Small Cap. It trades about -0.04 of its total potential returns per unit of risk. Allianzgi International Small Cap is currently generating about 0.19 per unit of volatility. If you would invest  3,091  in Allianzgi International Small Cap on May 4, 2025 and sell it today you would earn a total of  213.00  from holding Allianzgi International Small Cap or generate 6.89% return on investment over 90 days.

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

American Tower Corp  vs.  Allianzgi International Small

American Tower Corp

Risk-Adjusted Performance

Very Weak

Over the last 90 days American Tower Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable primary indicators, American Tower is not utilizing all of its potentials. The latest stock price uproar, may contribute to short-horizon losses for the private investors.

Allianzgi International

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Allianzgi International Small Cap are ranked lower than 15 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak basic indicators, Allianzgi International may actually be approaching a critical reversion point that can send shares even higher in September 2025.

Pair Trading with American Tower and Allianzgi International

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

The idea behind American Tower Corp and Allianzgi International Small Cap 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.

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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 Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.