Correlation Between Pimco Stocksplus and Locorr Market
Can any of the company-specific risk be diversified away by investing in both Pimco Stocksplus and Locorr Market 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 Stocksplus and Locorr Market into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Pimco Stocksplus Ar and Locorr Market Trend, you can compare the effects of market volatilities on Pimco Stocksplus and Locorr Market 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 Stocksplus with a short position of Locorr Market. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pimco Stocksplus and Locorr Market.
Diversification Opportunities for Pimco Stocksplus and Locorr Market
0.32 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Pimco and Locorr is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding Pimco Stocksplus Ar and Locorr Market Trend in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Locorr Market Trend and Pimco Stocksplus 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 Stocksplus Ar are associated (or correlated) with Locorr Market. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Locorr Market Trend has no effect on the direction of Pimco Stocksplus i.e., Pimco Stocksplus and Locorr Market go up and down completely randomly.
Pair Corralation between Pimco Stocksplus and Locorr Market
Assuming the 90 days horizon Pimco Stocksplus Ar is expected to under-perform the Locorr Market. But the mutual fund apears to be less risky and, when comparing its historical volatility, Pimco Stocksplus Ar is 1.41 times less risky than Locorr Market. The mutual fund trades about -0.06 of its potential returns per unit of risk. The Locorr Market Trend is currently generating about -0.04 of returns per unit of risk over similar time horizon. If you would invest 1,159 in Locorr Market Trend on September 12, 2024 and sell it today you would lose (70.00) from holding Locorr Market Trend or give up 6.04% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Pimco Stocksplus Ar vs. Locorr Market Trend
Performance |
| Timeline |
| Pimco Stocksplus |
| Locorr Market Trend |
Pimco Stocksplus and Locorr Market Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pimco Stocksplus and Locorr Market
The main advantage of trading using opposite Pimco Stocksplus and Locorr Market positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pimco Stocksplus position performs unexpectedly, Locorr Market 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 Locorr Market will offset losses from the drop in Locorr Market's long position.| Pimco Stocksplus vs. Grizzly Short Fund | Pimco Stocksplus vs. Inverse Sp 500 | Pimco Stocksplus vs. HUMANA INC | Pimco Stocksplus vs. Barloworld Ltd ADR |
| Locorr Market vs. Pimco Trends Managed | Locorr Market vs. Pimco Trends Managed | Locorr Market vs. SCOR PK | Locorr Market vs. Morningstar Unconstrained Allocation |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
Other Complementary Tools
| Insider Screener Find insiders across different sectors to evaluate their impact on performance | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios |