Correlation Between Pimco International and Commodityrealreturn
Can any of the company-specific risk be diversified away by investing in both Pimco International and Commodityrealreturn 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 International and Commodityrealreturn into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Pimco International Bond and Commodityrealreturn Strategy Fund, you can compare the effects of market volatilities on Pimco International and Commodityrealreturn 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 International with a short position of Commodityrealreturn. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pimco International and Commodityrealreturn.
Diversification Opportunities for Pimco International and Commodityrealreturn
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Pimco and Commodityrealreturn is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Pimco International Bond and Commodityrealreturn Strategy F in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Commodityrealreturn and Pimco International 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 International Bond are associated (or correlated) with Commodityrealreturn. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Commodityrealreturn has no effect on the direction of Pimco International i.e., Pimco International and Commodityrealreturn go up and down completely randomly.
Pair Corralation between Pimco International and Commodityrealreturn
Assuming the 90 days horizon Pimco International is expected to generate 3.5 times less return on investment than Commodityrealreturn. But when comparing it to its historical volatility, Pimco International Bond is 4.18 times less risky than Commodityrealreturn. It trades about 0.12 of its potential returns per unit of risk. Commodityrealreturn Strategy Fund is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 1,191 in Commodityrealreturn Strategy Fund on April 20, 2025 and sell it today you would earn a total of 59.00 from holding Commodityrealreturn Strategy Fund or generate 4.95% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Pimco International Bond vs. Commodityrealreturn Strategy F
Performance |
| Timeline |
| Pimco International Bond |
| Commodityrealreturn |
Pimco International and Commodityrealreturn Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pimco International and Commodityrealreturn
The main advantage of trading using opposite Pimco International and Commodityrealreturn positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pimco International position performs unexpectedly, Commodityrealreturn 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 Commodityrealreturn will offset losses from the drop in Commodityrealreturn's long position.| Pimco International vs. Franklin Federal Limited Term | Pimco International vs. The Short Term Municipal | Pimco International vs. Ab Select Longshort | Pimco International vs. Maryland Short Term Tax Free |
| Commodityrealreturn vs. Precious Metals And | Commodityrealreturn vs. James Balanced Golden | Commodityrealreturn vs. Fidelity Advisor Gold | Commodityrealreturn vs. Oppenheimer Gold Special |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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