Correlation Between Blackrock Muniyield and Pimco New
Can any of the company-specific risk be diversified away by investing in both Blackrock Muniyield and Pimco New 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 Blackrock Muniyield and Pimco New into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Blackrock Muniyield Quality and Pimco New York, you can compare the effects of market volatilities on Blackrock Muniyield and Pimco New 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 Blackrock Muniyield with a short position of Pimco New. Check out your portfolio center. Please also check ongoing floating volatility patterns of Blackrock Muniyield and Pimco New.
Diversification Opportunities for Blackrock Muniyield and Pimco New
0.96 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Blackrock and Pimco is 0.96. Overlapping area represents the amount of risk that can be diversified away by holding Blackrock Muniyield Quality and Pimco New York in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pimco New York and Blackrock Muniyield 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 Blackrock Muniyield Quality are associated (or correlated) with Pimco New. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pimco New York has no effect on the direction of Blackrock Muniyield i.e., Blackrock Muniyield and Pimco New go up and down completely randomly.
Pair Corralation between Blackrock Muniyield and Pimco New
Considering the 90-day investment horizon Blackrock Muniyield Quality is expected to generate 0.77 times more return on investment than Pimco New. However, Blackrock Muniyield Quality is 1.3 times less risky than Pimco New. It trades about 0.09 of its potential returns per unit of risk. Pimco New York is currently generating about 0.03 per unit of risk. If you would invest 1,031 in Blackrock Muniyield Quality on August 28, 2024 and sell it today you would earn a total of 9.00 from holding Blackrock Muniyield Quality or generate 0.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Blackrock Muniyield Quality vs. Pimco New York
Performance |
| Timeline |
| Blackrock Muniyield |
| Pimco New York |
Blackrock Muniyield and Pimco New Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Blackrock Muniyield and Pimco New
The main advantage of trading using opposite Blackrock Muniyield and Pimco New positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Blackrock Muniyield position performs unexpectedly, Pimco New 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 New will offset losses from the drop in Pimco New's long position.| Blackrock Muniyield vs. John Hancock Income | Blackrock Muniyield vs. MFS High Income | Blackrock Muniyield vs. MFS Investment Grade | Blackrock Muniyield vs. Blackrock Muniholdings Closed |
| Pimco New vs. Pimco New York | Pimco New vs. Pimco New York | Pimco New vs. Pimco California Municipal | Pimco New vs. Pimco Municipal Income |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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