Correlation Between Pcm Fund and Pimco High

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

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

Diversification Opportunities for Pcm Fund and Pimco High

0.92

Correlation Coefficient

Pcm Fund  Pimco High

Almost no diversification

The 3 months correlation between Pcm and Pimco is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding Pcm Fund and Pimco High Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pimco High Income and Pcm Fund 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 Pcm Fund are associated (or correlated) with Pimco High. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pimco High Income has no effect on the direction of Pcm Fund i.e., Pcm Fund and Pimco High go up and down completely randomly.

Pair Corralation between Pcm Fund and Pimco High

Considering the 90-day investment horizon Pcm Fund is expected to generate 2.32 times more return on investment than Pimco High. However, Pcm Fund is 2.32 times more volatile than Pimco High Income. It trades about 0.12 of its potential returns per unit of risk. Pimco High Income is currently generating about 0.25 per unit of risk. If you would invest  592.00  in Pcm Fund on April 25, 2025 and sell it today you would earn a total of  37.00  from holding Pcm Fund or generate 6.25% return on investment over 90 days.

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

Pcm Fund  vs.  Pimco High Income

Pcm Fund

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Pcm Fund are ranked lower than 9 (%) of all funds and portfolios of funds over the last 90 days. In spite of very inconsistent fundamental indicators, Pcm Fund may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Pimco High Income

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Pimco High Income are ranked lower than 19 (%) of all funds and portfolios of funds over the last 90 days. Despite quite persistent technical indicators, Pimco High is not utilizing all of its potentials. The recent stock price mess, may contribute to short-term losses for the institutional investors.

Pair Trading with Pcm Fund and Pimco High

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

The idea behind Pcm Fund and Pimco High Income 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.

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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.