Correlation Between Eagle Point and Pimco Dynamic
Can any of the company-specific risk be diversified away by investing in both Eagle Point and Pimco Dynamic 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 Eagle Point and Pimco Dynamic into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Eagle Point Credit and Pimco Dynamic Income, you can compare the effects of market volatilities on Eagle Point and Pimco Dynamic 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 Eagle Point with a short position of Pimco Dynamic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eagle Point and Pimco Dynamic.
Diversification Opportunities for Eagle Point and Pimco Dynamic
0.08 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Eagle and Pimco is 0.08. Overlapping area represents the amount of risk that can be diversified away by holding Eagle Point Credit and Pimco Dynamic Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pimco Dynamic Income and Eagle Point 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 Eagle Point Credit are associated (or correlated) with Pimco Dynamic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pimco Dynamic Income has no effect on the direction of Eagle Point i.e., Eagle Point and Pimco Dynamic go up and down completely randomly.
Pair Corralation between Eagle Point and Pimco Dynamic
Considering the 90-day investment horizon Eagle Point is expected to generate 5.5 times less return on investment than Pimco Dynamic. In addition to that, Eagle Point is 1.91 times more volatile than Pimco Dynamic Income. It trades about 0.03 of its total potential returns per unit of risk. Pimco Dynamic Income is currently generating about 0.28 per unit of volatility. If you would invest 1,853 in Pimco Dynamic Income on December 2, 2024 and sell it today you would earn a total of 142.00 from holding Pimco Dynamic Income or generate 7.66% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Eagle Point Credit vs. Pimco Dynamic Income
Performance |
Timeline |
Eagle Point Credit |
Pimco Dynamic Income |
Eagle Point and Pimco Dynamic Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Eagle Point and Pimco Dynamic
The main advantage of trading using opposite Eagle Point and Pimco Dynamic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eagle Point position performs unexpectedly, Pimco Dynamic 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 Dynamic will offset losses from the drop in Pimco Dynamic's long position.Eagle Point vs. Cornerstone Strategic Return | Eagle Point vs. Cornerstone Strategic Value | Eagle Point vs. Oxford Square Capital | Eagle Point vs. Guggenheim Strategic Opportunities |
Pimco Dynamic vs. Pimco Corporate Income | Pimco Dynamic vs. Guggenheim Strategic Opportunities | Pimco Dynamic vs. Pimco Dynamic Income | Pimco Dynamic vs. Pimco High Income |
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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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