Correlation Between Pimco Dynamic and Foreign Bond
Can any of the company-specific risk be diversified away by investing in both Pimco Dynamic and Foreign Bond 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 Dynamic and Foreign Bond into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Pimco Dynamic Bond and Foreign Bond Fund, you can compare the effects of market volatilities on Pimco Dynamic and Foreign Bond 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 Dynamic with a short position of Foreign Bond. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pimco Dynamic and Foreign Bond.
Diversification Opportunities for Pimco Dynamic and Foreign Bond
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Pimco and Foreign is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding Pimco Dynamic Bond and Foreign Bond Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Foreign Bond and Pimco Dynamic 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 Dynamic Bond are associated (or correlated) with Foreign Bond. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Foreign Bond has no effect on the direction of Pimco Dynamic i.e., Pimco Dynamic and Foreign Bond go up and down completely randomly.
Pair Corralation between Pimco Dynamic and Foreign Bond
Assuming the 90 days horizon Pimco Dynamic Bond is expected to generate 0.4 times more return on investment than Foreign Bond. However, Pimco Dynamic Bond is 2.52 times less risky than Foreign Bond. It trades about 0.18 of its potential returns per unit of risk. Foreign Bond Fund is currently generating about 0.03 per unit of risk. If you would invest 894.00 in Pimco Dynamic Bond on August 31, 2024 and sell it today you would earn a total of 106.00 from holding Pimco Dynamic Bond or generate 11.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Pimco Dynamic Bond vs. Foreign Bond Fund
Performance |
| Timeline |
| Pimco Dynamic Bond |
| Foreign Bond |
Pimco Dynamic and Foreign Bond Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pimco Dynamic and Foreign Bond
The main advantage of trading using opposite Pimco Dynamic and Foreign Bond positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pimco Dynamic position performs unexpectedly, Foreign Bond 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 Foreign Bond will offset losses from the drop in Foreign Bond's long position.| Pimco Dynamic vs. Gmo Resources | Pimco Dynamic vs. Firsthand Alternative Energy | Pimco Dynamic vs. World Energy Fund | Pimco Dynamic vs. Calvert Global Energy |
| Foreign Bond vs. Prudential Jennison International | Foreign Bond vs. Fidelity New Markets | Foreign Bond vs. Ohio Variable College |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
Other Complementary Tools
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. | |
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes |