Correlation Between PIMCO Active and SPDR DoubleLine
Can any of the company-specific risk be diversified away by investing in both PIMCO Active and SPDR DoubleLine 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 SPDR DoubleLine 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 SPDR DoubleLine Total, you can compare the effects of market volatilities on PIMCO Active and SPDR DoubleLine 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 SPDR DoubleLine. Check out your portfolio center. Please also check ongoing floating volatility patterns of PIMCO Active and SPDR DoubleLine.
Diversification Opportunities for PIMCO Active and SPDR DoubleLine
1.0 | Correlation Coefficient |
No risk reduction
The 3 months correlation between PIMCO and SPDR is 1.0. Overlapping area represents the amount of risk that can be diversified away by holding PIMCO Active Bond and SPDR DoubleLine Total in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SPDR DoubleLine Total 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 SPDR DoubleLine. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SPDR DoubleLine Total has no effect on the direction of PIMCO Active i.e., PIMCO Active and SPDR DoubleLine go up and down completely randomly.
Pair Corralation between PIMCO Active and SPDR DoubleLine
Given the investment horizon of 90 days PIMCO Active Bond is expected to generate 0.93 times more return on investment than SPDR DoubleLine. However, PIMCO Active Bond is 1.07 times less risky than SPDR DoubleLine. It trades about 0.04 of its potential returns per unit of risk. SPDR DoubleLine Total is currently generating about 0.03 per unit of risk. If you would invest 8,515 in PIMCO Active Bond on August 27, 2024 and sell it today you would earn a total of 632.00 from holding PIMCO Active Bond or generate 7.42% 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. SPDR DoubleLine Total
Performance |
| Timeline |
| PIMCO Active Bond |
| SPDR DoubleLine Total |
PIMCO Active and SPDR DoubleLine Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PIMCO Active and SPDR DoubleLine
The main advantage of trading using opposite PIMCO Active and SPDR DoubleLine positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PIMCO Active position performs unexpectedly, SPDR DoubleLine 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 SPDR DoubleLine will offset losses from the drop in SPDR DoubleLine's long position.| PIMCO Active vs. Valued Advisers Trust | PIMCO Active vs. Columbia Diversified Fixed | PIMCO Active vs. Principal Exchange Traded Funds | PIMCO Active vs. Doubleline Etf Trust |
| SPDR DoubleLine vs. PIMCO Active Bond | SPDR DoubleLine vs. SPDR Blackstone Senior | SPDR DoubleLine vs. SPDR Barclays Intermediate | SPDR DoubleLine vs. SPDR Bloomberg Investment |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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