Correlation Between Glg Intl and Pimco All
Can any of the company-specific risk be diversified away by investing in both Glg Intl and Pimco All 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 Glg Intl and Pimco All into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Glg Intl Small and Pimco All Asset, you can compare the effects of market volatilities on Glg Intl and Pimco All 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 Glg Intl with a short position of Pimco All. Check out your portfolio center. Please also check ongoing floating volatility patterns of Glg Intl and Pimco All.
Diversification Opportunities for Glg Intl and Pimco All
Very weak diversification
The 3 months correlation between Glg and Pimco is 0.4. Overlapping area represents the amount of risk that can be diversified away by holding Glg Intl Small and Pimco All Asset in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pimco All Asset and Glg Intl 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 Glg Intl Small are associated (or correlated) with Pimco All. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pimco All Asset has no effect on the direction of Glg Intl i.e., Glg Intl and Pimco All go up and down completely randomly.
Pair Corralation between Glg Intl and Pimco All
Assuming the 90 days horizon Glg Intl Small is expected to generate 2.44 times more return on investment than Pimco All. However, Glg Intl is 2.44 times more volatile than Pimco All Asset. It trades about 0.36 of its potential returns per unit of risk. Pimco All Asset is currently generating about 0.22 per unit of risk. If you would invest 8,346 in Glg Intl Small on November 3, 2024 and sell it today you would earn a total of 565.00 from holding Glg Intl Small or generate 6.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Glg Intl Small vs. Pimco All Asset
Performance |
| Timeline |
| Glg Intl Small |
| Pimco All Asset |
Glg Intl and Pimco All Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Glg Intl and Pimco All
The main advantage of trading using opposite Glg Intl and Pimco All positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Glg Intl position performs unexpectedly, Pimco All 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 All will offset losses from the drop in Pimco All's long position.| Glg Intl vs. Hunter Small Cap | Glg Intl vs. Ab Small Cap | Glg Intl vs. Df Dent Small | Glg Intl vs. Needham Small Cap |
| Pimco All vs. Tax Managed Mid Small | Pimco All vs. Praxis Small Cap | Pimco All vs. Ab Small Cap | Pimco All vs. Kinetics Small Cap |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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