Correlation Between PIMCO Mortgage and SPDR Bloomberg

Can any of the company-specific risk be diversified away by investing in both PIMCO Mortgage and SPDR Bloomberg 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 Mortgage and SPDR Bloomberg into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between PIMCO Mortgage Backed Securities and SPDR Bloomberg 1 10, you can compare the effects of market volatilities on PIMCO Mortgage and SPDR Bloomberg 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 Mortgage with a short position of SPDR Bloomberg. Check out your portfolio center. Please also check ongoing floating volatility patterns of PIMCO Mortgage and SPDR Bloomberg.

Diversification Opportunities for PIMCO Mortgage and SPDR Bloomberg

0.93

Correlation Coefficient

PIMCO Mortgage  SPDR Bloomberg

Almost no diversification

The 3 months correlation between PIMCO and SPDR is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding PIMCO Mortgage Backed Securiti and SPDR Bloomberg 1 10 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SPDR Bloomberg 1 and PIMCO Mortgage 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 Mortgage Backed Securities are associated (or correlated) with SPDR Bloomberg. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SPDR Bloomberg 1 has no effect on the direction of PIMCO Mortgage i.e., PIMCO Mortgage and SPDR Bloomberg go up and down completely randomly.

Pair Corralation between PIMCO Mortgage and SPDR Bloomberg

Given the investment horizon of 90 days PIMCO Mortgage Backed Securities is expected to generate 1.65 times more return on investment than SPDR Bloomberg. However, PIMCO Mortgage is 1.65 times more volatile than SPDR Bloomberg 1 10. It trades about 0.18 of its potential returns per unit of risk. SPDR Bloomberg 1 10 is currently generating about 0.22 per unit of risk. If you would invest  4,732  in PIMCO Mortgage Backed Securities on May 14, 2025 and sell it today you would earn a total of  162.00  from holding PIMCO Mortgage Backed Securities or generate 3.42% return on investment over 90 days.

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

PIMCO Mortgage Backed Securiti  vs.  SPDR Bloomberg 1 10

PIMCO Mortgage Backed

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in PIMCO Mortgage Backed Securities are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable fundamental drivers, PIMCO Mortgage is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

SPDR Bloomberg 1

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in SPDR Bloomberg 1 10 are ranked lower than 17 (%) of all global equities and portfolios over the last 90 days. In spite of fairly strong basic indicators, SPDR Bloomberg is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with PIMCO Mortgage and SPDR Bloomberg

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

The idea behind PIMCO Mortgage Backed Securities and SPDR Bloomberg 1 10 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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.