Correlation Between Pgim High and Pimco Global
Can any of the company-specific risk be diversified away by investing in both Pgim High 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 Pgim High and Pimco Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Pgim High Yield and Pimco Global Advantage, you can compare the effects of market volatilities on Pgim High 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 Pgim High with a short position of Pimco Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pgim High and Pimco Global.
Diversification Opportunities for Pgim High and Pimco Global
0.1 | Correlation Coefficient |
Average diversification
The 3 months correlation between Pgim and Pimco is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding Pgim High Yield and Pimco Global Advantage in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pimco Global Advantage and Pgim High 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 Pgim High Yield 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 Advantage has no effect on the direction of Pgim High i.e., Pgim High and Pimco Global go up and down completely randomly.
Pair Corralation between Pgim High and Pimco Global
Assuming the 90 days horizon Pgim High Yield is expected to generate 1.26 times more return on investment than Pimco Global. However, Pgim High is 1.26 times more volatile than Pimco Global Advantage. It trades about 0.19 of its potential returns per unit of risk. Pimco Global Advantage is currently generating about 0.16 per unit of risk. If you would invest 417.00 in Pgim High Yield on September 4, 2024 and sell it today you would earn a total of 67.00 from holding Pgim High Yield or generate 16.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 99.66% |
| Values | Daily Returns |
Pgim High Yield vs. Pimco Global Advantage
Performance |
| Timeline |
| Pgim High Yield |
| Pimco Global Advantage |
Pgim High and Pimco Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pgim High and Pimco Global
The main advantage of trading using opposite Pgim High and Pimco Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pgim High 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.| Pgim High vs. Prudential Total Return | Pgim High vs. Metropolitan West Total | Pgim High vs. John Hancock Disciplined | Pgim High vs. Europacific Growth Fund |
| Pimco Global vs. Astor Longshort Fund | Pimco Global vs. Goldman Sachs Short | Pimco Global vs. Old Westbury Short Term | Pimco Global vs. Siit Ultra Short |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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