Correlation Between Bancroft Fund and Allianzgi Equity

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

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

Diversification Opportunities for Bancroft Fund and Allianzgi Equity

0.97

Correlation Coefficient

Bancroft Fund  Allianzgi Equity

Almost no diversification

The 3 months correlation between Bancroft and Allianzgi is 0.97. Overlapping area represents the amount of risk that can be diversified away by holding Bancroft Fund Limited and Allianzgi Equity Convertible in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Allianzgi Equity Con and Bancroft Fund 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 Bancroft Fund Limited are associated (or correlated) with Allianzgi Equity. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Allianzgi Equity Con has no effect on the direction of Bancroft Fund i.e., Bancroft Fund and Allianzgi Equity go up and down completely randomly.

Pair Corralation between Bancroft Fund and Allianzgi Equity

Considering the 90-day investment horizon Bancroft Fund Limited is expected to generate 1.21 times more return on investment than Allianzgi Equity. However, Bancroft Fund is 1.21 times more volatile than Allianzgi Equity Convertible. It trades about 0.33 of its potential returns per unit of risk. Allianzgi Equity Convertible is currently generating about 0.26 per unit of risk. If you would invest  1,707  in Bancroft Fund Limited on May 6, 2025 and sell it today you would earn a total of  288.00  from holding Bancroft Fund Limited or generate 16.87% return on investment over 90 days.

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

Bancroft Fund Limited  vs.  Allianzgi Equity Convertible

Bancroft Fund Limited

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Bancroft Fund Limited are ranked lower than 25 (%) of all global equities and portfolios over the last 90 days. In spite of fairly fragile fundamental indicators, Bancroft Fund showed solid returns over the last few months and may actually be approaching a breakup point.

Allianzgi Equity Con

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Allianzgi Equity Convertible are ranked lower than 20 (%) of all funds and portfolios of funds over the last 90 days. In spite of rather abnormal forward indicators, Allianzgi Equity may actually be approaching a critical reversion point that can send shares even higher in September 2025.

Pair Trading with Bancroft Fund and Allianzgi Equity

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

The idea behind Bancroft Fund Limited and Allianzgi Equity Convertible 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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.