Correlation Between Hartford Municipal and PIMCO Intermediate
Can any of the company-specific risk be diversified away by investing in both Hartford Municipal and PIMCO Intermediate 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 Hartford Municipal and PIMCO Intermediate into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hartford Municipal Opportunities and PIMCO Intermediate Municipal, you can compare the effects of market volatilities on Hartford Municipal and PIMCO Intermediate 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 Hartford Municipal with a short position of PIMCO Intermediate. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hartford Municipal and PIMCO Intermediate.
Diversification Opportunities for Hartford Municipal and PIMCO Intermediate
0.98 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Hartford and PIMCO is 0.98. Overlapping area represents the amount of risk that can be diversified away by holding Hartford Municipal Opportuniti and PIMCO Intermediate Municipal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PIMCO Intermediate and Hartford Municipal 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 Hartford Municipal Opportunities are associated (or correlated) with PIMCO Intermediate. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PIMCO Intermediate has no effect on the direction of Hartford Municipal i.e., Hartford Municipal and PIMCO Intermediate go up and down completely randomly.
Pair Corralation between Hartford Municipal and PIMCO Intermediate
Given the investment horizon of 90 days Hartford Municipal Opportunities is expected to generate about the same return on investment as PIMCO Intermediate Municipal. However, Hartford Municipal is 1.07 times more volatile than PIMCO Intermediate Municipal. It trades about 0.01 of its potential returns per unit of risk. PIMCO Intermediate Municipal is currently producing about 0.01 per unit of risk. If you would invest 5,164 in PIMCO Intermediate Municipal on October 26, 2024 and sell it today you would earn a total of 8.00 from holding PIMCO Intermediate Municipal or generate 0.15% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hartford Municipal Opportuniti vs. PIMCO Intermediate Municipal
Performance |
| Timeline |
| Hartford Municipal |
| PIMCO Intermediate |
Hartford Municipal and PIMCO Intermediate Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hartford Municipal and PIMCO Intermediate
The main advantage of trading using opposite Hartford Municipal and PIMCO Intermediate positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hartford Municipal position performs unexpectedly, PIMCO Intermediate 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 Intermediate will offset losses from the drop in PIMCO Intermediate's long position.| Hartford Municipal vs. IQ MacKay Municipal | Hartford Municipal vs. IQ MacKay Municipal | Hartford Municipal vs. Franklin Liberty Federal | Hartford Municipal vs. Franklin Liberty Intermediate |
| PIMCO Intermediate vs. PIMCO Short Term | PIMCO Intermediate vs. VanEck Intermediate Muni | PIMCO Intermediate vs. VanEck Long Muni | PIMCO Intermediate vs. VanEck Short Muni |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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