Correlation Between PIMCO ETF and AltShares Trust
Can any of the company-specific risk be diversified away by investing in both PIMCO ETF and AltShares Trust 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 ETF and AltShares Trust into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PIMCO ETF Trust and AltShares Trust , you can compare the effects of market volatilities on PIMCO ETF and AltShares Trust 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 ETF with a short position of AltShares Trust. Check out your portfolio center. Please also check ongoing floating volatility patterns of PIMCO ETF and AltShares Trust.
Diversification Opportunities for PIMCO ETF and AltShares Trust
0.11 | Correlation Coefficient |
Average diversification
The 3 months correlation between PIMCO and AltShares is 0.11. Overlapping area represents the amount of risk that can be diversified away by holding PIMCO ETF Trust and AltShares Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AltShares Trust and PIMCO ETF 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 ETF Trust are associated (or correlated) with AltShares Trust. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AltShares Trust has no effect on the direction of PIMCO ETF i.e., PIMCO ETF and AltShares Trust go up and down completely randomly.
Pair Corralation between PIMCO ETF and AltShares Trust
Given the investment horizon of 90 days PIMCO ETF Trust is expected to generate 29.39 times more return on investment than AltShares Trust. However, PIMCO ETF is 29.39 times more volatile than AltShares Trust . It trades about 0.06 of its potential returns per unit of risk. AltShares Trust is currently generating about -0.14 per unit of risk. If you would invest 2,548 in PIMCO ETF Trust on September 14, 2024 and sell it today you would earn a total of 93.00 from holding PIMCO ETF Trust or generate 3.65% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
PIMCO ETF Trust vs. AltShares Trust
Performance |
| Timeline |
| PIMCO ETF Trust |
| AltShares Trust |
PIMCO ETF and AltShares Trust Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PIMCO ETF and AltShares Trust
The main advantage of trading using opposite PIMCO ETF and AltShares Trust positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PIMCO ETF position performs unexpectedly, AltShares Trust 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 AltShares Trust will offset losses from the drop in AltShares Trust's long position.| PIMCO ETF vs. Tidal Trust II | PIMCO ETF vs. ProShares VIX Mid Term | PIMCO ETF vs. ProShares VIX Short Term | PIMCO ETF vs. LHA Market State |
| AltShares Trust vs. ProShares Hedge Replication | AltShares Trust vs. IQ Merger Arbitrage | AltShares Trust vs. ProShares Global Listed | AltShares Trust vs. ProShares Investment GradeInterest |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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