Correlation Between Proshares Russell and PIMCO Active
Can any of the company-specific risk be diversified away by investing in both Proshares Russell and PIMCO Active 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 Proshares Russell and PIMCO Active into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Proshares Russell 2000 and PIMCO Active Bond, you can compare the effects of market volatilities on Proshares Russell and PIMCO Active 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 Proshares Russell with a short position of PIMCO Active. Check out your portfolio center. Please also check ongoing floating volatility patterns of Proshares Russell and PIMCO Active.
Diversification Opportunities for Proshares Russell and PIMCO Active
-0.48 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Proshares and PIMCO is -0.48. Overlapping area represents the amount of risk that can be diversified away by holding Proshares Russell 2000 and PIMCO Active Bond in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PIMCO Active Bond and Proshares Russell 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 Proshares Russell 2000 are associated (or correlated) with PIMCO Active. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PIMCO Active Bond has no effect on the direction of Proshares Russell i.e., Proshares Russell and PIMCO Active go up and down completely randomly.
Pair Corralation between Proshares Russell and PIMCO Active
Given the investment horizon of 90 days Proshares Russell 2000 is expected to generate 3.33 times more return on investment than PIMCO Active. However, Proshares Russell is 3.33 times more volatile than PIMCO Active Bond. It trades about 0.21 of its potential returns per unit of risk. PIMCO Active Bond is currently generating about 0.12 per unit of risk. If you would invest 4,154 in Proshares Russell 2000 on August 31, 2024 and sell it today you would earn a total of 231.00 from holding Proshares Russell 2000 or generate 5.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Proshares Russell 2000 vs. PIMCO Active Bond
Performance |
| Timeline |
| Proshares Russell 2000 |
| PIMCO Active Bond |
Proshares Russell and PIMCO Active Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Proshares Russell and PIMCO Active
The main advantage of trading using opposite Proshares Russell and PIMCO Active positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Proshares Russell position performs unexpectedly, PIMCO Active 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 Active will offset losses from the drop in PIMCO Active's long position.| Proshares Russell vs. Global X Dow | Proshares Russell vs. AdvisorShares STAR Global | Proshares Russell vs. Global X Funds | Proshares Russell vs. FT Vest Dow |
| PIMCO Active vs. Valued Advisers Trust | PIMCO Active vs. Columbia Diversified Fixed | PIMCO Active vs. Principal Exchange Traded Funds | PIMCO Active vs. Doubleline Etf Trust |
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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