Correlation Between Pimco Total and Core Plus
Can any of the company-specific risk be diversified away by investing in both Pimco Total and Core Plus 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 Total and Core Plus into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Pimco Total Return and Core Plus Income, you can compare the effects of market volatilities on Pimco Total and Core Plus 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 Total with a short position of Core Plus. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pimco Total and Core Plus.
Diversification Opportunities for Pimco Total and Core Plus
0.99 | Correlation Coefficient |
No risk reduction
The 3 months correlation between Pimco and Core is 0.99. Overlapping area represents the amount of risk that can be diversified away by holding Pimco Total Return and Core Plus Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Core Plus Income and Pimco Total 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 Total Return are associated (or correlated) with Core Plus. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Core Plus Income has no effect on the direction of Pimco Total i.e., Pimco Total and Core Plus go up and down completely randomly.
Pair Corralation between Pimco Total and Core Plus
Assuming the 90 days horizon Pimco Total Return is expected to under-perform the Core Plus. In addition to that, Pimco Total is 1.04 times more volatile than Core Plus Income. It trades about -0.1 of its total potential returns per unit of risk. Core Plus Income is currently generating about -0.04 per unit of volatility. If you would invest 963.00 in Core Plus Income on August 25, 2024 and sell it today you would lose (3.00) from holding Core Plus Income or give up 0.31% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Pimco Total Return vs. Core Plus Income
Performance |
| Timeline |
| Pimco Total Return |
| Core Plus Income |
Pimco Total and Core Plus Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pimco Total and Core Plus
The main advantage of trading using opposite Pimco Total and Core Plus positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pimco Total position performs unexpectedly, Core Plus 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 Core Plus will offset losses from the drop in Core Plus' long position.| Pimco Total vs. Pimco Rae Worldwide | Pimco Total vs. Pimco Rae Worldwide | Pimco Total vs. Pimco Rae Worldwide | Pimco Total vs. Pimco Rae Worldwide |
| Core Plus vs. Artisan High Income | Core Plus vs. T Rowe Price | Core Plus vs. Dodge Global Bond | Core Plus vs. Performance Trust Strategic |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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