Correlation Between PIMCO Energy and IHIT
Can any of the company-specific risk be diversified away by investing in both PIMCO Energy and IHIT 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 Energy and IHIT into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PIMCO Energy And and IHIT, you can compare the effects of market volatilities on PIMCO Energy and IHIT 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 Energy with a short position of IHIT. Check out your portfolio center. Please also check ongoing floating volatility patterns of PIMCO Energy and IHIT.
Diversification Opportunities for PIMCO Energy and IHIT
-0.2 | Correlation Coefficient |
Good diversification
The 3 months correlation between PIMCO and IHIT is -0.2. Overlapping area represents the amount of risk that can be diversified away by holding PIMCO Energy And and IHIT in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on IHIT and PIMCO Energy 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 Energy And are associated (or correlated) with IHIT. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of IHIT has no effect on the direction of PIMCO Energy i.e., PIMCO Energy and IHIT go up and down completely randomly.
Pair Corralation between PIMCO Energy and IHIT
Given the investment horizon of 90 days PIMCO Energy And is expected to generate 2.63 times more return on investment than IHIT. However, PIMCO Energy is 2.63 times more volatile than IHIT. It trades about 0.07 of its potential returns per unit of risk. IHIT is currently generating about -0.06 per unit of risk. If you would invest 1,430 in PIMCO Energy And on August 30, 2024 and sell it today you would earn a total of 211.00 from holding PIMCO Energy And or generate 14.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.35% |
| Values | Daily Returns |
PIMCO Energy And vs. IHIT
Performance |
| Timeline |
| PIMCO Energy And |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| IHIT |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
PIMCO Energy and IHIT Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PIMCO Energy and IHIT
The main advantage of trading using opposite PIMCO Energy and IHIT positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PIMCO Energy position performs unexpectedly, IHIT 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 IHIT will offset losses from the drop in IHIT's long position.| PIMCO Energy vs. Neuberger Berman Next | PIMCO Energy vs. Doubleline Yield Opportunities | PIMCO Energy vs. Highland Global Allocation | PIMCO Energy vs. Doubleline Income Solutions |
| IHIT vs. MFS Investment Grade | IHIT vs. Eaton Vance National | IHIT vs. Invesco High Income | IHIT vs. Nuveen California Select |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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