Correlation Between Pimco Preferred and Pimco International
Can any of the company-specific risk be diversified away by investing in both Pimco Preferred and Pimco International 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 Preferred and Pimco International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Pimco Preferred And and Pimco International Bond, you can compare the effects of market volatilities on Pimco Preferred and Pimco International 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 Preferred with a short position of Pimco International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pimco Preferred and Pimco International.
Diversification Opportunities for Pimco Preferred and Pimco International
0.33 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Pimco and Pimco is 0.33. Overlapping area represents the amount of risk that can be diversified away by holding Pimco Preferred And and Pimco International Bond in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pimco International Bond and Pimco Preferred 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 Preferred And are associated (or correlated) with Pimco International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pimco International Bond has no effect on the direction of Pimco Preferred i.e., Pimco Preferred and Pimco International go up and down completely randomly.
Pair Corralation between Pimco Preferred and Pimco International
Assuming the 90 days horizon Pimco Preferred And is expected to under-perform the Pimco International. In addition to that, Pimco Preferred is 1.83 times more volatile than Pimco International Bond. It trades about -0.26 of its total potential returns per unit of risk. Pimco International Bond is currently generating about 0.08 per unit of volatility. If you would invest 977.00 in Pimco International Bond on January 12, 2025 and sell it today you would earn a total of 4.00 from holding Pimco International Bond or generate 0.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Pimco Preferred And vs. Pimco International Bond
Performance |
| Timeline |
| Pimco Preferred And |
| Pimco International Bond |
Pimco Preferred and Pimco International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pimco Preferred and Pimco International
The main advantage of trading using opposite Pimco Preferred and Pimco International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pimco Preferred position performs unexpectedly, Pimco International 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 International will offset losses from the drop in Pimco International's long position.| Pimco Preferred vs. Legg Mason Global | Pimco Preferred vs. Ab Global Risk | Pimco Preferred vs. Qs Global Equity | Pimco Preferred vs. Dreyfusstandish Global Fixed |
| Pimco International vs. Pimco Rae Worldwide | Pimco International vs. Pimco Rae Worldwide | Pimco International vs. Pimco Rae Worldwide | Pimco International vs. Pimco Rae Worldwide |
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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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