Correlation Between Pimco Global and Fidelity Municipal
Can any of the company-specific risk be diversified away by investing in both Pimco Global and Fidelity Municipal 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 Global and Fidelity Municipal into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Pimco Global Multi Asset and Fidelity Municipal Income, you can compare the effects of market volatilities on Pimco Global and Fidelity Municipal 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 Global with a short position of Fidelity Municipal. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pimco Global and Fidelity Municipal.
Diversification Opportunities for Pimco Global and Fidelity Municipal
0.16 | Correlation Coefficient |
Average diversification
The 3 months correlation between Pimco and Fidelity is 0.16. Overlapping area represents the amount of risk that can be diversified away by holding Pimco Global Multi Asset and Fidelity Municipal Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fidelity Municipal Income and Pimco Global 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 Global Multi Asset are associated (or correlated) with Fidelity Municipal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fidelity Municipal Income has no effect on the direction of Pimco Global i.e., Pimco Global and Fidelity Municipal go up and down completely randomly.
Pair Corralation between Pimco Global and Fidelity Municipal
Assuming the 90 days horizon Pimco Global Multi Asset is expected to generate 6.4 times more return on investment than Fidelity Municipal. However, Pimco Global is 6.4 times more volatile than Fidelity Municipal Income. It trades about 0.09 of its potential returns per unit of risk. Fidelity Municipal Income is currently generating about 0.14 per unit of risk. If you would invest 1,173 in Pimco Global Multi Asset on September 3, 2024 and sell it today you would earn a total of 290.00 from holding Pimco Global Multi Asset or generate 24.72% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Pimco Global Multi Asset vs. Fidelity Municipal Income
Performance |
| Timeline |
| Pimco Global Multi |
| Fidelity Municipal Income |
Pimco Global and Fidelity Municipal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pimco Global and Fidelity Municipal
The main advantage of trading using opposite Pimco Global and Fidelity Municipal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pimco Global position performs unexpectedly, Fidelity Municipal 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 Fidelity Municipal will offset losses from the drop in Fidelity Municipal's long position.| Pimco Global vs. Scharf Global Opportunity | Pimco Global vs. Abr 7525 Volatility | Pimco Global vs. Bbh Intermediate Municipal | Pimco Global vs. T Rowe Price |
| Fidelity Municipal vs. Growth Strategy Fund | Fidelity Municipal vs. T Rowe Price | Fidelity Municipal vs. T Rowe Price | Fidelity Municipal vs. Qs Global Equity |
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 Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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