Correlation Between Pimco Foreign and Total Return
Can any of the company-specific risk be diversified away by investing in both Pimco Foreign and Total Return 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 Foreign and Total Return into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Pimco Foreign Bond and Total Return Fund, you can compare the effects of market volatilities on Pimco Foreign and Total Return 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 Foreign with a short position of Total Return. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pimco Foreign and Total Return.
Diversification Opportunities for Pimco Foreign and Total Return
0.12 | Correlation Coefficient |
Average diversification
The 3 months correlation between PIMCO and Total is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding Pimco Foreign Bond and Total Return Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Total Return and Pimco Foreign 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 Foreign Bond are associated (or correlated) with Total Return. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Total Return has no effect on the direction of Pimco Foreign i.e., Pimco Foreign and Total Return go up and down completely randomly.
Pair Corralation between Pimco Foreign and Total Return
Assuming the 90 days horizon Pimco Foreign Bond is expected to generate 0.48 times more return on investment than Total Return. However, Pimco Foreign Bond is 2.1 times less risky than Total Return. It trades about 0.21 of its potential returns per unit of risk. Total Return Fund is currently generating about 0.07 per unit of risk. If you would invest 989.00 in Pimco Foreign Bond on August 30, 2024 and sell it today you would earn a total of 8.00 from holding Pimco Foreign Bond or generate 0.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Pimco Foreign Bond vs. Total Return Fund
Performance |
| Timeline |
| Pimco Foreign Bond |
| Total Return |
Pimco Foreign and Total Return Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pimco Foreign and Total Return
The main advantage of trading using opposite Pimco Foreign and Total Return positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pimco Foreign position performs unexpectedly, Total Return 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 Total Return will offset losses from the drop in Total Return's long position.| Pimco Foreign vs. Bbh Intermediate Municipal | Pimco Foreign vs. Sterling Capital Short | Pimco Foreign vs. Rbc Bluebay Global | Pimco Foreign vs. Nuveen Massachusetts Municipal |
| Total Return vs. Vanguard Institutional Index | Total Return vs. Dodge Stock Fund | Total Return vs. Europacific Growth Fund | Total Return vs. Real Return 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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
Other Complementary Tools
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences |