Correlation Between BlackRock Credit and Pimco Corporate
Can any of the company-specific risk be diversified away by investing in both BlackRock Credit and Pimco Corporate 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 BlackRock Credit and Pimco Corporate into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BlackRock Credit Allocation and Pimco Corporate Income, you can compare the effects of market volatilities on BlackRock Credit and Pimco Corporate 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 BlackRock Credit with a short position of Pimco Corporate. Check out your portfolio center. Please also check ongoing floating volatility patterns of BlackRock Credit and Pimco Corporate.
Diversification Opportunities for BlackRock Credit and Pimco Corporate
0.77 | Correlation Coefficient |
Poor diversification
The 3 months correlation between BlackRock and Pimco is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding BlackRock Credit Allocation and Pimco Corporate Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pimco Corporate Income and BlackRock Credit 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 BlackRock Credit Allocation are associated (or correlated) with Pimco Corporate. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pimco Corporate Income has no effect on the direction of BlackRock Credit i.e., BlackRock Credit and Pimco Corporate go up and down completely randomly.
Pair Corralation between BlackRock Credit and Pimco Corporate
Considering the 90-day investment horizon BlackRock Credit Allocation is expected to generate 1.33 times more return on investment than Pimco Corporate. However, BlackRock Credit is 1.33 times more volatile than Pimco Corporate Income. It trades about 0.23 of its potential returns per unit of risk. Pimco Corporate Income is currently generating about 0.3 per unit of risk. If you would invest 1,031 in BlackRock Credit Allocation on October 20, 2024 and sell it today you would earn a total of 24.00 from holding BlackRock Credit Allocation or generate 2.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
BlackRock Credit Allocation vs. Pimco Corporate Income
Performance |
| Timeline |
| BlackRock Credit All |
| Pimco Corporate Income |
BlackRock Credit and Pimco Corporate Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BlackRock Credit and Pimco Corporate
The main advantage of trading using opposite BlackRock Credit and Pimco Corporate positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BlackRock Credit position performs unexpectedly, Pimco Corporate 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 Corporate will offset losses from the drop in Pimco Corporate's long position.| BlackRock Credit vs. Pimco Corporate Income | BlackRock Credit vs. Pimco Income Strategy | BlackRock Credit vs. Pcm Fund | BlackRock Credit vs. Pimco High Income |
| Pimco Corporate vs. Pimco Dynamic Income | Pimco Corporate vs. Guggenheim Strategic Opportunities | Pimco Corporate vs. Pimco Dynamic Income | Pimco Corporate vs. Pimco High Income |
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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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