Correlation Between Pimco California and Pimco New
Can any of the company-specific risk be diversified away by investing in both Pimco California and Pimco New 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 California and Pimco New into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Pimco California Municipal and Pimco New York, you can compare the effects of market volatilities on Pimco California and Pimco New 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 California with a short position of Pimco New. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pimco California and Pimco New.
Diversification Opportunities for Pimco California and Pimco New
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Pimco and Pimco is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Pimco California Municipal and Pimco New York in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pimco New York and Pimco California 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 California Municipal are associated (or correlated) with Pimco New. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pimco New York has no effect on the direction of Pimco California i.e., Pimco California and Pimco New go up and down completely randomly.
Pair Corralation between Pimco California and Pimco New
Considering the 90-day investment horizon Pimco California Municipal is expected to under-perform the Pimco New. But the fund apears to be less risky and, when comparing its historical volatility, Pimco California Municipal is 1.18 times less risky than Pimco New. The fund trades about -0.11 of its potential returns per unit of risk. The Pimco New York is currently generating about -0.05 of returns per unit of risk over similar time horizon. If you would invest 694.00 in Pimco New York on May 6, 2025 and sell it today you would lose (13.00) from holding Pimco New York or give up 1.87% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Strong |
Accuracy | 100.0% |
Values | Daily Returns |
Pimco California Municipal vs. Pimco New York
Performance |
Timeline |
Pimco California Mun |
Pimco New York |
Pimco California and Pimco New Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Pimco California and Pimco New
The main advantage of trading using opposite Pimco California and Pimco New positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pimco California position performs unexpectedly, Pimco New 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 New will offset losses from the drop in Pimco New's long position.Pimco California vs. Pimco California Municipal | Pimco California vs. BlackRock California Municipal | Pimco California vs. Blackrock Muniholdings Ca | Pimco California vs. Invesco California Value |
Pimco New vs. Invesco Trust For | Pimco New vs. Pimco New York | Pimco New vs. Pimco New York | Pimco New vs. BlackRock New York |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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