Correlation Between Pimco Commoditiesplus and Franklin Floating
Can any of the company-specific risk be diversified away by investing in both Pimco Commoditiesplus and Franklin Floating 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 Commoditiesplus and Franklin Floating into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Pimco Moditiesplus Strategy and Franklin Floating Rate, you can compare the effects of market volatilities on Pimco Commoditiesplus and Franklin Floating 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 Commoditiesplus with a short position of Franklin Floating. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pimco Commoditiesplus and Franklin Floating.
Diversification Opportunities for Pimco Commoditiesplus and Franklin Floating
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between PIMCO and Franklin is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Pimco Moditiesplus Strategy and Franklin Floating Rate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Franklin Floating Rate and Pimco Commoditiesplus 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 Moditiesplus Strategy are associated (or correlated) with Franklin Floating. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Franklin Floating Rate has no effect on the direction of Pimco Commoditiesplus i.e., Pimco Commoditiesplus and Franklin Floating go up and down completely randomly.
Pair Corralation between Pimco Commoditiesplus and Franklin Floating
Assuming the 90 days horizon Pimco Moditiesplus Strategy is expected to generate 2.7 times more return on investment than Franklin Floating. However, Pimco Commoditiesplus is 2.7 times more volatile than Franklin Floating Rate. It trades about 0.32 of its potential returns per unit of risk. Franklin Floating Rate is currently generating about 0.14 per unit of risk. If you would invest 645.00 in Pimco Moditiesplus Strategy on October 25, 2024 and sell it today you would earn a total of 34.00 from holding Pimco Moditiesplus Strategy or generate 5.27% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 94.74% |
| Values | Daily Returns |
Pimco Moditiesplus Strategy vs. Franklin Floating Rate
Performance |
| Timeline |
| Pimco Commoditiesplus |
| Franklin Floating Rate |
Pimco Commoditiesplus and Franklin Floating Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pimco Commoditiesplus and Franklin Floating
The main advantage of trading using opposite Pimco Commoditiesplus and Franklin Floating positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pimco Commoditiesplus position performs unexpectedly, Franklin Floating 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 Franklin Floating will offset losses from the drop in Franklin Floating's long position.| Pimco Commoditiesplus vs. Pimco Energy Tactical | Pimco Commoditiesplus vs. Fidelity Advisor Energy | Pimco Commoditiesplus vs. Virtus Select Mlp | Pimco Commoditiesplus vs. Energy Services Fund |
| Franklin Floating vs. Pimco Moditiesplus Strategy | Franklin Floating vs. Transamerica Emerging Markets | Franklin Floating vs. Jpmorgan Emerging Markets | Franklin Floating vs. Wasatch Frontier Emerging |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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