Correlation Between Long-term and Pimco Long-term
Can any of the company-specific risk be diversified away by investing in both Long-term and Pimco Long-term 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 Long-term and Pimco Long-term into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Long Term Government Fund and Pimco Long Term Credit, you can compare the effects of market volatilities on Long-term and Pimco Long-term 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 Long-term with a short position of Pimco Long-term. Check out your portfolio center. Please also check ongoing floating volatility patterns of Long-term and Pimco Long-term.
Diversification Opportunities for Long-term and Pimco Long-term
0.98 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Long-term and Pimco is 0.98. Overlapping area represents the amount of risk that can be diversified away by holding Long Term Government Fund and Pimco Long Term Credit in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pimco Long Term and Long-term 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 Long Term Government Fund are associated (or correlated) with Pimco Long-term. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pimco Long Term has no effect on the direction of Long-term i.e., Long-term and Pimco Long-term go up and down completely randomly.
Pair Corralation between Long-term and Pimco Long-term
Assuming the 90 days horizon Long-term is expected to generate 1.04 times less return on investment than Pimco Long-term. In addition to that, Long-term is 1.21 times more volatile than Pimco Long Term Credit. It trades about 0.07 of its total potential returns per unit of risk. Pimco Long Term Credit is currently generating about 0.09 per unit of volatility. If you would invest 889.00 in Pimco Long Term Credit on August 30, 2024 and sell it today you would earn a total of 14.00 from holding Pimco Long Term Credit or generate 1.57% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 95.65% |
| Values | Daily Returns |
Long Term Government Fund vs. Pimco Long Term Credit
Performance |
| Timeline |
| Long Term Government |
| Pimco Long Term |
Long-term and Pimco Long-term Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Long-term and Pimco Long-term
The main advantage of trading using opposite Long-term and Pimco Long-term positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Long-term position performs unexpectedly, Pimco Long-term 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 Long-term will offset losses from the drop in Pimco Long-term's long position.| Long-term vs. Pimco Rae Worldwide | Long-term vs. Pimco Rae Worldwide | Long-term vs. Pimco Rae Worldwide | Long-term vs. Pimco Rae Worldwide |
| Pimco Long-term vs. Pimco Rae Worldwide | Pimco Long-term vs. Pimco Rae Worldwide | Pimco Long-term vs. Pimco Rae Worldwide | Pimco Long-term 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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
Other Complementary Tools
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
| CEOs Directory Screen CEOs from public companies around the world | |
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences |