Correlation Between Pimco Income and Stocksplus Total
Can any of the company-specific risk be diversified away by investing in both Pimco Income and Stocksplus Total 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 Income and Stocksplus Total into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Pimco Income Fund and Stocksplus Total Return, you can compare the effects of market volatilities on Pimco Income and Stocksplus Total 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 Income with a short position of Stocksplus Total. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pimco Income and Stocksplus Total.
Diversification Opportunities for Pimco Income and Stocksplus Total
0.33 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Pimco and Stocksplus is 0.33. Overlapping area represents the amount of risk that can be diversified away by holding Pimco Income Fund and Stocksplus Total Return in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Stocksplus Total Return and Pimco Income 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 Income Fund are associated (or correlated) with Stocksplus Total. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Stocksplus Total Return has no effect on the direction of Pimco Income i.e., Pimco Income and Stocksplus Total go up and down completely randomly.
Pair Corralation between Pimco Income and Stocksplus Total
Assuming the 90 days horizon Pimco Income Fund is expected to generate 0.26 times more return on investment than Stocksplus Total. However, Pimco Income Fund is 3.82 times less risky than Stocksplus Total. It trades about 0.38 of its potential returns per unit of risk. Stocksplus Total Return is currently generating about 0.01 per unit of risk. If you would invest 1,052 in Pimco Income Fund on November 27, 2024 and sell it today you would earn a total of 16.00 from holding Pimco Income Fund or generate 1.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Pimco Income Fund vs. Stocksplus Total Return
Performance |
| Timeline |
| Pimco Income |
| Stocksplus Total Return |
Pimco Income and Stocksplus Total Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pimco Income and Stocksplus Total
The main advantage of trading using opposite Pimco Income and Stocksplus Total positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pimco Income position performs unexpectedly, Stocksplus Total 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 Stocksplus Total will offset losses from the drop in Stocksplus Total's long position.| Pimco Income vs. Doubleline Total Return | Pimco Income vs. Investment Grade Porate | Pimco Income vs. Pimco Foreign Bond | Pimco Income vs. Metropolitan West Total |
| Stocksplus Total vs. Financial Industries Fund | Stocksplus Total vs. Financial Services Portfolio | Stocksplus Total vs. Fidelity Advisor Financial | Stocksplus Total vs. Goldman Sachs Financial |
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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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