Correlation Between PIMCO Active and PIMCO Investment
Can any of the company-specific risk be diversified away by investing in both PIMCO Active and PIMCO Investment 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 PIMCO Active and PIMCO Investment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PIMCO Active Bond and PIMCO Investment Grade, you can compare the effects of market volatilities on PIMCO Active and PIMCO Investment 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 PIMCO Active with a short position of PIMCO Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of PIMCO Active and PIMCO Investment.
Diversification Opportunities for PIMCO Active and PIMCO Investment
0.98 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between PIMCO and PIMCO is 0.98. Overlapping area represents the amount of risk that can be diversified away by holding PIMCO Active Bond and PIMCO Investment Grade in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PIMCO Investment Grade and PIMCO Active 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 PIMCO Active Bond are associated (or correlated) with PIMCO Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PIMCO Investment Grade has no effect on the direction of PIMCO Active i.e., PIMCO Active and PIMCO Investment go up and down completely randomly.
Pair Corralation between PIMCO Active and PIMCO Investment
Given the investment horizon of 90 days PIMCO Active is expected to generate 1.06 times less return on investment than PIMCO Investment. But when comparing it to its historical volatility, PIMCO Active Bond is 1.08 times less risky than PIMCO Investment. It trades about 0.12 of its potential returns per unit of risk. PIMCO Investment Grade is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 9,498 in PIMCO Investment Grade on November 4, 2024 and sell it today you would earn a total of 87.00 from holding PIMCO Investment Grade or generate 0.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
PIMCO Active Bond vs. PIMCO Investment Grade
Performance |
| Timeline |
| PIMCO Active Bond |
| PIMCO Investment Grade |
PIMCO Active and PIMCO Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PIMCO Active and PIMCO Investment
The main advantage of trading using opposite PIMCO Active and PIMCO Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PIMCO Active position performs unexpectedly, PIMCO Investment 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 Investment will offset losses from the drop in PIMCO Investment's long position.| PIMCO Active vs. Columbia Diversified Fixed | PIMCO Active vs. Doubleline Etf Trust | PIMCO Active vs. Virtus Newfleet ABSMBS | PIMCO Active vs. Vident Core Bond |
| PIMCO Investment vs. PIMCO 0 5 Year | PIMCO Investment vs. iShares Aaa | PIMCO Investment vs. PIMCO Active Bond | PIMCO Investment vs. Invesco Fundamental High |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
Other Complementary Tools
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. | |
| Insider Screener Find insiders across different sectors to evaluate their impact on performance | |
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets |