Correlation Between Baloise Holding and PIMCO Short
Can any of the company-specific risk be diversified away by investing in both Baloise Holding and PIMCO Short 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 Baloise Holding and PIMCO Short into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Baloise Holding AG and PIMCO Short Term High, you can compare the effects of market volatilities on Baloise Holding and PIMCO Short 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 Baloise Holding with a short position of PIMCO Short. Check out your portfolio center. Please also check ongoing floating volatility patterns of Baloise Holding and PIMCO Short.
Diversification Opportunities for Baloise Holding and PIMCO Short
0.34 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Baloise and PIMCO is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding Baloise Holding AG and PIMCO Short Term High in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PIMCO Short Term and Baloise Holding 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 Baloise Holding AG are associated (or correlated) with PIMCO Short. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PIMCO Short Term has no effect on the direction of Baloise Holding i.e., Baloise Holding and PIMCO Short go up and down completely randomly.
Pair Corralation between Baloise Holding and PIMCO Short
Assuming the 90 days trading horizon Baloise Holding AG is expected to generate 3.36 times more return on investment than PIMCO Short. However, Baloise Holding is 3.36 times more volatile than PIMCO Short Term High. It trades about 0.06 of its potential returns per unit of risk. PIMCO Short Term High is currently generating about 0.17 per unit of risk. If you would invest 16,590 in Baloise Holding AG on September 1, 2024 and sell it today you would earn a total of 150.00 from holding Baloise Holding AG or generate 0.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Baloise Holding AG vs. PIMCO Short Term High
Performance |
| Timeline |
| Baloise Holding AG |
| PIMCO Short Term |
Baloise Holding and PIMCO Short Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Baloise Holding and PIMCO Short
The main advantage of trading using opposite Baloise Holding and PIMCO Short positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Baloise Holding position performs unexpectedly, PIMCO Short 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 PIMCO Short will offset losses from the drop in PIMCO Short's long position.| Baloise Holding vs. Swiss Life Holding | Baloise Holding vs. Helvetia Holding AG | Baloise Holding vs. Swisscom AG | Baloise Holding vs. Zurich Insurance Group |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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