Correlation Between PIMCO Investment and Dow Jones
Can any of the company-specific risk be diversified away by investing in both PIMCO Investment and Dow Jones 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 Investment and Dow Jones into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PIMCO Investment Grade and Dow Jones Industrial, you can compare the effects of market volatilities on PIMCO Investment and Dow Jones 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 Investment with a short position of Dow Jones. Check out your portfolio center. Please also check ongoing floating volatility patterns of PIMCO Investment and Dow Jones.
Diversification Opportunities for PIMCO Investment and Dow Jones
-0.51 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between PIMCO and Dow is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding PIMCO Investment Grade and Dow Jones Industrial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dow Jones Industrial and PIMCO Investment 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 Investment Grade are associated (or correlated) with Dow Jones. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dow Jones Industrial has no effect on the direction of PIMCO Investment i.e., PIMCO Investment and Dow Jones go up and down completely randomly.
Pair Corralation between PIMCO Investment and Dow Jones
Given the investment horizon of 90 days PIMCO Investment is expected to generate 5.44 times less return on investment than Dow Jones. But when comparing it to its historical volatility, PIMCO Investment Grade is 2.43 times less risky than Dow Jones. It trades about 0.17 of its potential returns per unit of risk. Dow Jones Industrial is currently generating about 0.37 of returns per unit of risk over similar time horizon. If you would invest 4,176,346 in Dow Jones Industrial on September 1, 2024 and sell it today you would earn a total of 314,719 from holding Dow Jones Industrial or generate 7.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
PIMCO Investment Grade vs. Dow Jones Industrial
Performance |
| Timeline |
PIMCO Investment and Dow Jones Volatility Contrast
Predicted Return Density |
| Returns |
PIMCO Investment Grade
Pair trading matchups for PIMCO Investment
Dow Jones Industrial
Pair trading matchups for Dow Jones
Pair Trading with PIMCO Investment and Dow Jones
The main advantage of trading using opposite PIMCO Investment and Dow Jones positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PIMCO Investment position performs unexpectedly, Dow Jones 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 Dow Jones will offset losses from the drop in Dow Jones' long position.| PIMCO Investment vs. PIMCO 0 5 Year | PIMCO Investment vs. iShares Aaa | PIMCO Investment vs. PIMCO Active Bond | PIMCO Investment vs. Invesco Fundamental High |
| Dow Jones vs. Catalyst Pharmaceuticals | Dow Jones vs. Sphere Entertainment Co | Dow Jones vs. National CineMedia | Dow Jones vs. Mink Therapeutics |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
Other Complementary Tools
| Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance |