Correlation Between Pimco Moditiesplus and Global Resources

Can any of the company-specific risk be diversified away by investing in both Pimco Moditiesplus and Global Resources 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 Moditiesplus and Global Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Pimco Moditiesplus Strategy and Global Resources Fund, you can compare the effects of market volatilities on Pimco Moditiesplus and Global Resources 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 Moditiesplus with a short position of Global Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pimco Moditiesplus and Global Resources.

Diversification Opportunities for Pimco Moditiesplus and Global Resources

0.64

Correlation Coefficient

Pimco Moditiesplus  Global Resources

Poor diversification

The 3 months correlation between Pimco and Global is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Pimco Moditiesplus Strategy and Global Resources Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Global Resources and Pimco Moditiesplus 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 Moditiesplus Strategy are associated (or correlated) with Global Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Global Resources has no effect on the direction of Pimco Moditiesplus i.e., Pimco Moditiesplus and Global Resources go up and down completely randomly.

Pair Corralation between Pimco Moditiesplus and Global Resources

Assuming the 90 days horizon Pimco Moditiesplus is expected to generate 1.02 times less return on investment than Global Resources. But when comparing it to its historical volatility, Pimco Moditiesplus Strategy is 1.19 times less risky than Global Resources. It trades about 0.02 of its potential returns per unit of risk. Global Resources Fund is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest  400.00  in Global Resources Fund on May 4, 2025 and sell it today you would earn a total of  25.00  from holding Global Resources Fund or generate 6.25% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	100.0%
Values	Daily Returns

Pimco Moditiesplus Strategy  vs.  Global Resources Fund

Pimco Moditiesplus

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Pimco Moditiesplus Strategy are ranked lower than 9 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak basic indicators, Pimco Moditiesplus may actually be approaching a critical reversion point that can send shares even higher in September 2025.

Global Resources

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Global Resources Fund are ranked lower than 17 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak technical and fundamental indicators, Global Resources showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Pimco Moditiesplus and Global Resources

The main advantage of trading using opposite Pimco Moditiesplus and Global Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pimco Moditiesplus position performs unexpectedly, Global Resources 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 Global Resources will offset losses from the drop in Global Resources' long position.

The idea behind Pimco Moditiesplus Strategy and Global Resources Fund pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.