Correlation Between Pnc Emerging and Municipal Bond
Can any of the company-specific risk be diversified away by investing in both Pnc Emerging and Municipal Bond 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 Pnc Emerging and Municipal Bond into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Pnc Emerging Markets and Municipal Bond Portfolio, you can compare the effects of market volatilities on Pnc Emerging and Municipal Bond 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 Pnc Emerging with a short position of Municipal Bond. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pnc Emerging and Municipal Bond.
Diversification Opportunities for Pnc Emerging and Municipal Bond
0.37 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Pnc and Municipal is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding Pnc Emerging Markets and Municipal Bond Portfolio in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Municipal Bond Portfolio and Pnc Emerging 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 Pnc Emerging Markets are associated (or correlated) with Municipal Bond. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Municipal Bond Portfolio has no effect on the direction of Pnc Emerging i.e., Pnc Emerging and Municipal Bond go up and down completely randomly.
Pair Corralation between Pnc Emerging and Municipal Bond
Assuming the 90 days horizon Pnc Emerging Markets is expected to generate 8.13 times more return on investment than Municipal Bond. However, Pnc Emerging is 8.13 times more volatile than Municipal Bond Portfolio. It trades about 0.2 of its potential returns per unit of risk. Municipal Bond Portfolio is currently generating about 0.17 per unit of risk. If you would invest 1,672 in Pnc Emerging Markets on May 30, 2025 and sell it today you would earn a total of 189.00 from holding Pnc Emerging Markets or generate 11.3% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Pnc Emerging Markets vs. Municipal Bond Portfolio
Performance |
| Timeline |
| Pnc Emerging Markets |
| Municipal Bond Portfolio |
Pnc Emerging and Municipal Bond Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pnc Emerging and Municipal Bond
The main advantage of trading using opposite Pnc Emerging and Municipal Bond positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pnc Emerging position performs unexpectedly, Municipal Bond 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 Municipal Bond will offset losses from the drop in Municipal Bond's long position.| Pnc Emerging vs. Ab High Income | Pnc Emerging vs. Fidelity American High | Pnc Emerging vs. Aggressive Balanced Allocation | Pnc Emerging vs. Virtus High Yield |
| Municipal Bond vs. The Gamco Global | Municipal Bond vs. Virtus Convertible | Municipal Bond vs. Lord Abbett Convertible | Municipal Bond vs. Harbor Vertible Securities |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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