Correlation Between Barings Emerging and Pimco Global
Can any of the company-specific risk be diversified away by investing in both Barings Emerging and Pimco Global 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 Barings Emerging and Pimco Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Barings Emerging Markets and Pimco Global Multi Asset, you can compare the effects of market volatilities on Barings Emerging and Pimco Global 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 Barings Emerging with a short position of Pimco Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Barings Emerging and Pimco Global.
Diversification Opportunities for Barings Emerging and Pimco Global
0.54 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Barings and Pimco is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding Barings Emerging Markets and Pimco Global Multi Asset in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pimco Global Multi and Barings Emerging 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 Barings Emerging Markets are associated (or correlated) with Pimco Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pimco Global Multi has no effect on the direction of Barings Emerging i.e., Barings Emerging and Pimco Global go up and down completely randomly.
Pair Corralation between Barings Emerging and Pimco Global
Assuming the 90 days horizon Barings Emerging Markets is expected to under-perform the Pimco Global. But the mutual fund apears to be less risky and, when comparing its historical volatility, Barings Emerging Markets is 1.35 times less risky than Pimco Global. The mutual fund trades about -0.19 of its potential returns per unit of risk. The Pimco Global Multi Asset is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 1,479 in Pimco Global Multi Asset on September 3, 2024 and sell it today you would earn a total of 12.00 from holding Pimco Global Multi Asset or generate 0.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Barings Emerging Markets vs. Pimco Global Multi Asset
Performance |
| Timeline |
| Barings Emerging Markets |
| Pimco Global Multi |
Barings Emerging and Pimco Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Barings Emerging and Pimco Global
The main advantage of trading using opposite Barings Emerging and Pimco Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Barings Emerging position performs unexpectedly, Pimco Global 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 Global will offset losses from the drop in Pimco Global's long position.| Barings Emerging vs. Ab Small Cap | Barings Emerging vs. Ab Small Cap | Barings Emerging vs. Oklahoma College Savings | Barings Emerging vs. Champlain Small |
| Pimco Global vs. Barings Emerging Markets | Pimco Global vs. Legg Mason Partners | Pimco Global vs. Calamos Market Neutral | Pimco Global vs. Mondrian Emerging Markets |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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