Correlation Between Pimco Trends and Grant Park
Can any of the company-specific risk be diversified away by investing in both Pimco Trends and Grant Park 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 Trends and Grant Park into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Pimco Trends Managed and Grant Park Multi, you can compare the effects of market volatilities on Pimco Trends and Grant Park 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 Trends with a short position of Grant Park. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pimco Trends and Grant Park.
Diversification Opportunities for Pimco Trends and Grant Park
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Pimco and Grant is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Pimco Trends Managed and Grant Park Multi in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Grant Park Multi and Pimco Trends 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 Trends Managed are associated (or correlated) with Grant Park. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Grant Park Multi has no effect on the direction of Pimco Trends i.e., Pimco Trends and Grant Park go up and down completely randomly.
Pair Corralation between Pimco Trends and Grant Park
Assuming the 90 days horizon Pimco Trends Managed is expected to under-perform the Grant Park. In addition to that, Pimco Trends is 1.27 times more volatile than Grant Park Multi. It trades about -0.02 of its total potential returns per unit of risk. Grant Park Multi is currently generating about -0.02 per unit of volatility. If you would invest 1,080 in Grant Park Multi on September 4, 2024 and sell it today you would lose (7.00) from holding Grant Park Multi or give up 0.65% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 98.44% |
| Values | Daily Returns |
Pimco Trends Managed vs. Grant Park Multi
Performance |
| Timeline |
| Pimco Trends Managed |
| Grant Park Multi |
Pimco Trends and Grant Park Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pimco Trends and Grant Park
The main advantage of trading using opposite Pimco Trends and Grant Park positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pimco Trends position performs unexpectedly, Grant Park 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 Grant Park will offset losses from the drop in Grant Park's long position.| Pimco Trends vs. Small Midcap Dividend Income | Pimco Trends vs. Fisher Small Cap | Pimco Trends vs. Qs Small Capitalization | Pimco Trends vs. Kinetics Small Cap |
| Grant Park vs. Dunham Large Cap | Grant Park vs. Vela Large Cap | Grant Park vs. Qs Large Cap | Grant Park vs. Siit Large Cap |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
Other Complementary Tools
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
| USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA | |
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments |