Correlation Between Aig Government and Pimco Foreign
Can any of the company-specific risk be diversified away by investing in both Aig Government and Pimco Foreign 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 Aig Government and Pimco Foreign into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aig Government Money and Pimco Foreign Bond, you can compare the effects of market volatilities on Aig Government and Pimco Foreign 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 Aig Government with a short position of Pimco Foreign. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aig Government and Pimco Foreign.
Diversification Opportunities for Aig Government and Pimco Foreign
0.19 | Correlation Coefficient |
Average diversification
The 3 months correlation between Aig and Pimco is 0.19. Overlapping area represents the amount of risk that can be diversified away by holding Aig Government Money and Pimco Foreign Bond in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pimco Foreign Bond and Aig Government 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 Aig Government Money are associated (or correlated) with Pimco Foreign. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pimco Foreign Bond has no effect on the direction of Aig Government i.e., Aig Government and Pimco Foreign go up and down completely randomly.
Pair Corralation between Aig Government and Pimco Foreign
Assuming the 90 days horizon Aig Government is expected to generate 2.14 times less return on investment than Pimco Foreign. In addition to that, Aig Government is 1.54 times more volatile than Pimco Foreign Bond. It trades about 0.15 of its total potential returns per unit of risk. Pimco Foreign Bond is currently generating about 0.49 per unit of volatility. If you would invest 988.00 in Pimco Foreign Bond on September 4, 2024 and sell it today you would earn a total of 17.00 from holding Pimco Foreign Bond or generate 1.72% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aig Government Money vs. Pimco Foreign Bond
Performance |
| Timeline |
| Aig Government Money |
| Pimco Foreign Bond |
Aig Government and Pimco Foreign Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aig Government and Pimco Foreign
The main advantage of trading using opposite Aig Government and Pimco Foreign positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aig Government position performs unexpectedly, Pimco Foreign 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 Pimco Foreign will offset losses from the drop in Pimco Foreign's long position.| Aig Government vs. Simt Multi Asset Accumulation | Aig Government vs. Saat Market Growth | Aig Government vs. Simt Real Return | Aig Government vs. Simt Small Cap |
| Pimco Foreign vs. Wt Mutual Fund | Pimco Foreign vs. Aig Government Money | Pimco Foreign vs. General Money Market | Pimco Foreign vs. Wilmington Funds |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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