Correlation Between Doubleline Floating and Pimco Municipal
Can any of the company-specific risk be diversified away by investing in both Doubleline Floating and Pimco Municipal 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 Doubleline Floating and Pimco Municipal into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Doubleline Floating Rate and Pimco Municipal Income, you can compare the effects of market volatilities on Doubleline Floating and Pimco Municipal 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 Doubleline Floating with a short position of Pimco Municipal. Check out your portfolio center. Please also check ongoing floating volatility patterns of Doubleline Floating and Pimco Municipal.
Diversification Opportunities for Doubleline Floating and Pimco Municipal
-0.84 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Doubleline and Pimco is -0.84. Overlapping area represents the amount of risk that can be diversified away by holding Doubleline Floating Rate and Pimco Municipal Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pimco Municipal Income and Doubleline Floating 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 Doubleline Floating Rate are associated (or correlated) with Pimco Municipal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pimco Municipal Income has no effect on the direction of Doubleline Floating i.e., Doubleline Floating and Pimco Municipal go up and down completely randomly.
Pair Corralation between Doubleline Floating and Pimco Municipal
Assuming the 90 days horizon Doubleline Floating is expected to generate 1.82 times less return on investment than Pimco Municipal. But when comparing it to its historical volatility, Doubleline Floating Rate is 10.83 times less risky than Pimco Municipal. It trades about 0.45 of its potential returns per unit of risk. Pimco Municipal Income is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 721.00 in Pimco Municipal Income on October 20, 2024 and sell it today you would earn a total of 7.00 from holding Pimco Municipal Income or generate 0.97% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Doubleline Floating Rate vs. Pimco Municipal Income
Performance |
| Timeline |
| Doubleline Floating Rate |
| Pimco Municipal Income |
Doubleline Floating and Pimco Municipal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Doubleline Floating and Pimco Municipal
The main advantage of trading using opposite Doubleline Floating and Pimco Municipal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Doubleline Floating position performs unexpectedly, Pimco Municipal 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 Municipal will offset losses from the drop in Pimco Municipal's long position.| Doubleline Floating vs. Lord Abbett Diversified | Doubleline Floating vs. Locorr Market Trend | Doubleline Floating vs. Investec Emerging Markets | Doubleline Floating vs. Inverse Emerging Markets |
| Pimco Municipal vs. Pimco Municipal Income | Pimco Municipal vs. Pimco Municipal Income | Pimco Municipal vs. Pimco California Municipal | Pimco Municipal vs. Pimco New York |
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 Stocks Directory module to find actively traded stocks across global markets.
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