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
-0.27 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Pimco and Stocksplus is -0.27. 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 is expected to generate 3.17 times less return on investment than Stocksplus Total. But when comparing it to its historical volatility, Pimco Income Fund is 2.76 times less risky than Stocksplus Total. It trades about 0.08 of its potential returns per unit of risk. Stocksplus Total Return is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 866.00 in Stocksplus Total Return on August 25, 2024 and sell it today you would earn a total of 421.00 from holding Stocksplus Total Return or generate 48.61% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| 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. T Rowe Price | Pimco Income vs. T Rowe Price | Pimco Income vs. Oklahoma Municipal Fund | Pimco Income vs. Ab Impact Municipal |
| Stocksplus Total vs. Pimco Rae Worldwide | Stocksplus Total vs. Pimco Rae Worldwide | Stocksplus Total vs. Pimco Rae Worldwide | Stocksplus Total vs. Pimco Rae Worldwide |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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