Correlation Between Pimco New and CBH
Can any of the company-specific risk be diversified away by investing in both Pimco New and CBH 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 New and CBH into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Pimco New York and CBH, you can compare the effects of market volatilities on Pimco New and CBH 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 New with a short position of CBH. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pimco New and CBH.
Diversification Opportunities for Pimco New and CBH
Significant diversification
The 3 months correlation between Pimco and CBH is 0.08. Overlapping area represents the amount of risk that can be diversified away by holding Pimco New York and CBH in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CBH and Pimco New 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 New York are associated (or correlated) with CBH. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CBH has no effect on the direction of Pimco New i.e., Pimco New and CBH go up and down completely randomly.
Pair Corralation between Pimco New and CBH
Considering the 90-day investment horizon Pimco New York is expected to under-perform the CBH. But the fund apears to be less risky and, when comparing its historical volatility, Pimco New York is 5.2 times less risky than CBH. The fund trades about -0.01 of its potential returns per unit of risk. The CBH is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 772.00 in CBH on August 24, 2024 and sell it today you would earn a total of 985.00 from holding CBH or generate 127.59% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 88.31% |
| Values | Daily Returns |
Pimco New York vs. CBH
Performance |
| Timeline |
| Pimco New York |
| CBH |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Strong
Pimco New and CBH Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pimco New and CBH
The main advantage of trading using opposite Pimco New and CBH positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pimco New position performs unexpectedly, CBH 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 CBH will offset losses from the drop in CBH's long position.| Pimco New vs. Invesco Pennsylvania Value | Pimco New vs. Blackrock Muniholdings Ny | Pimco New vs. Eaton Vance National | Pimco New vs. Nuveen New York |
| CBH vs. MFS Investment Grade | CBH vs. Invesco High Income | CBH vs. Eaton Vance National | CBH vs. Nuveen California Select |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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