Correlation Between CBH and Pimco New
Can any of the company-specific risk be diversified away by investing in both CBH and Pimco New 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 CBH and Pimco New into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CBH and Pimco New York, you can compare the effects of market volatilities on CBH and Pimco New 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 CBH with a short position of Pimco New. Check out your portfolio center. Please also check ongoing floating volatility patterns of CBH and Pimco New.
Diversification Opportunities for CBH and Pimco New
Good diversification
The 3 months correlation between CBH and Pimco is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding CBH and Pimco New York in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pimco New York and CBH 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 CBH are associated (or correlated) with Pimco New. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pimco New York has no effect on the direction of CBH i.e., CBH and Pimco New go up and down completely randomly.
Pair Corralation between CBH and Pimco New
Considering the 90-day investment horizon CBH is expected to generate 11.0 times more return on investment than Pimco New. However, CBH is 11.0 times more volatile than Pimco New York. It trades about 0.08 of its potential returns per unit of risk. Pimco New York is currently generating about 0.06 per unit of risk. If you would invest 835.00 in CBH on August 24, 2024 and sell it today you would earn a total of 922.00 from holding CBH or generate 110.42% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 76.8% |
| Values | Daily Returns |
CBH vs. Pimco New York
Performance |
| Timeline |
| CBH |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Pimco New York |
CBH and Pimco New Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CBH and Pimco New
The main advantage of trading using opposite CBH and Pimco New positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CBH position performs unexpectedly, Pimco New 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 New will offset losses from the drop in Pimco New's long position.| CBH vs. MFS Investment Grade | CBH vs. Invesco High Income | CBH vs. Eaton Vance National | CBH vs. Nuveen California Select |
| Pimco New vs. MFS Investment Grade | Pimco New vs. Eaton Vance National | Pimco New vs. Blackrock Muniyield Quality | Pimco New vs. Munivest Fund |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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