Correlation Between PIMCO Euro and Lyxor MSCI
Can any of the company-specific risk be diversified away by investing in both PIMCO Euro and Lyxor MSCI 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 Euro and Lyxor MSCI into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PIMCO Euro Short Term and Lyxor MSCI Brazil, you can compare the effects of market volatilities on PIMCO Euro and Lyxor MSCI 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 Euro with a short position of Lyxor MSCI. Check out your portfolio center. Please also check ongoing floating volatility patterns of PIMCO Euro and Lyxor MSCI.
Diversification Opportunities for PIMCO Euro and Lyxor MSCI
-0.51 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between PIMCO and Lyxor is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding PIMCO Euro Short Term and Lyxor MSCI Brazil in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lyxor MSCI Brazil and PIMCO Euro 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 Euro Short Term are associated (or correlated) with Lyxor MSCI. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lyxor MSCI Brazil has no effect on the direction of PIMCO Euro i.e., PIMCO Euro and Lyxor MSCI go up and down completely randomly.
Pair Corralation between PIMCO Euro and Lyxor MSCI
Assuming the 90 days trading horizon PIMCO Euro Short Term is expected to generate 0.12 times more return on investment than Lyxor MSCI. However, PIMCO Euro Short Term is 8.11 times less risky than Lyxor MSCI. It trades about 0.2 of its potential returns per unit of risk. Lyxor MSCI Brazil is currently generating about -0.07 per unit of risk. If you would invest 1,112 in PIMCO Euro Short Term on September 5, 2024 and sell it today you would earn a total of 48.00 from holding PIMCO Euro Short Term or generate 4.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
PIMCO Euro Short Term vs. Lyxor MSCI Brazil
Performance |
| Timeline |
| PIMCO Euro Short |
| Lyxor MSCI Brazil |
PIMCO Euro and Lyxor MSCI Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PIMCO Euro and Lyxor MSCI
The main advantage of trading using opposite PIMCO Euro and Lyxor MSCI positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PIMCO Euro position performs unexpectedly, Lyxor MSCI 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 Lyxor MSCI will offset losses from the drop in Lyxor MSCI's long position.| PIMCO Euro vs. UBSFund Solutions MSCI | PIMCO Euro vs. Vanguard SP 500 | PIMCO Euro vs. iShares Core SP | PIMCO Euro vs. Lyxor Japan UCITS |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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