Correlation Between Pimco New and Eagle Capital
Can any of the company-specific risk be diversified away by investing in both Pimco New and Eagle Capital 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 Eagle Capital 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 Eagle Capital Growth, you can compare the effects of market volatilities on Pimco New and Eagle Capital 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 Eagle Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pimco New and Eagle Capital.
Diversification Opportunities for Pimco New and Eagle Capital
-0.23 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Pimco and Eagle is -0.23. Overlapping area represents the amount of risk that can be diversified away by holding Pimco New York and Eagle Capital Growth in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eagle Capital Growth 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 Eagle Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eagle Capital Growth has no effect on the direction of Pimco New i.e., Pimco New and Eagle Capital go up and down completely randomly.
Pair Corralation between Pimco New and Eagle Capital
Considering the 90-day investment horizon Pimco New York is expected to under-perform the Eagle Capital. But the fund apears to be less risky and, when comparing its historical volatility, Pimco New York is 2.29 times less risky than Eagle Capital. The fund trades about -0.07 of its potential returns per unit of risk. The Eagle Capital Growth is currently generating about 0.18 of returns per unit of risk over similar time horizon. If you would invest 982.00 in Eagle Capital Growth on August 28, 2024 and sell it today you would earn a total of 54.00 from holding Eagle Capital Growth or generate 5.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Pimco New York vs. Eagle Capital Growth
Performance |
| Timeline |
| Pimco New York |
| Eagle Capital Growth |
Pimco New and Eagle Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pimco New and Eagle Capital
The main advantage of trading using opposite Pimco New and Eagle Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pimco New position performs unexpectedly, Eagle Capital 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 Eagle Capital will offset losses from the drop in Eagle Capital's long position.| Pimco New vs. Eaton Vance National | Pimco New vs. Invesco High Income | Pimco New vs. Nuveen California Select | Pimco New vs. MFS Investment Grade |
| Eagle Capital vs. Eaton Vance New | Eagle Capital vs. Pimco New York | Eagle Capital vs. Nuveen Amt Free Municipal | Eagle Capital vs. Western Asset Municipal |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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