Correlation Between Pimco Dynamic and Pimco Global
Can any of the company-specific risk be diversified away by investing in both Pimco Dynamic and Pimco Global 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 Pimco Global 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 Pimco Global Bond, you can compare the effects of market volatilities on Pimco Dynamic and Pimco Global 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 Pimco Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pimco Dynamic and Pimco Global.
Diversification Opportunities for Pimco Dynamic and Pimco Global
0.9 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Pimco and Pimco is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding Pimco Dynamic Bond and Pimco Global Bond in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pimco Global 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 Pimco Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pimco Global Bond has no effect on the direction of Pimco Dynamic i.e., Pimco Dynamic and Pimco Global go up and down completely randomly.
Pair Corralation between Pimco Dynamic and Pimco Global
Assuming the 90 days horizon Pimco Dynamic Bond is expected to generate 0.8 times more return on investment than Pimco Global. However, Pimco Dynamic Bond is 1.25 times less risky than Pimco Global. It trades about 0.16 of its potential returns per unit of risk. Pimco Global Bond is currently generating about 0.11 per unit of risk. If you would invest 890.00 in Pimco Dynamic Bond on October 24, 2024 and sell it today you would earn a total of 108.00 from holding Pimco Dynamic Bond or generate 12.13% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 99.74% |
| Values | Daily Returns |
Pimco Dynamic Bond vs. Pimco Global Bond
Performance |
| Timeline |
| Pimco Dynamic Bond |
| Pimco Global Bond |
Pimco Dynamic and Pimco Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pimco Dynamic and Pimco Global
The main advantage of trading using opposite Pimco Dynamic and Pimco Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pimco Dynamic position performs unexpectedly, Pimco Global 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 Global will offset losses from the drop in Pimco Global's long position.| Pimco Dynamic vs. Voya Target Retirement | Pimco Dynamic vs. Lifestyle Ii Moderate | Pimco Dynamic vs. Moderate Balanced Allocation | Pimco Dynamic vs. American Funds Retirement |
| Pimco Global vs. Foreign Bond Fund | Pimco Global vs. Emerging Markets Bond | Pimco Global vs. High Yield Fund | Pimco Global vs. Low Duration Fund |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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