Correlation Between Janus Flexible and Pimco Total

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

By analyzing existing cross correlation between Janus Flexible Bond and Pimco Total Return, you can compare the effects of market volatilities on Janus Flexible and Pimco Total 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 Janus Flexible with a short position of Pimco Total. Check out your portfolio center. Please also check ongoing floating volatility patterns of Janus Flexible and Pimco Total.

Diversification Opportunities for Janus Flexible and Pimco Total

0.99

Correlation Coefficient

Janus Flexible  Pimco Total

No risk reduction

The 3 months correlation between Janus and Pimco is 0.99. Overlapping area represents the amount of risk that can be diversified away by holding Janus Flexible Bond and Pimco Total Return in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pimco Total Return and Janus Flexible 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 Janus Flexible Bond are associated (or correlated) with Pimco Total. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pimco Total Return has no effect on the direction of Janus Flexible i.e., Janus Flexible and Pimco Total go up and down completely randomly.

Pair Corralation between Janus Flexible and Pimco Total

Assuming the 90 days horizon Janus Flexible Bond is expected to under-perform the Pimco Total. But the mutual fund apears to be less risky and, when comparing its historical volatility, Janus Flexible Bond is 1.05 times less risky than Pimco Total. The mutual fund trades about -0.49 of its potential returns per unit of risk. The Pimco Total Return is currently generating about -0.37 of returns per unit of risk over similar time horizon. If you would invest  864.00  in Pimco Total Return on October 9, 2024 and sell it today you would lose (17.00) from holding Pimco Total Return or give up 1.97% of portfolio value over 90 days.

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

Janus Flexible Bond  vs.  Pimco Total Return

Janus Flexible Bond

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Janus Flexible Bond has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong basic indicators, Janus Flexible is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pimco Total Return

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Pimco Total Return has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong basic indicators, Pimco Total is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Janus Flexible and Pimco Total

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

The idea behind Janus Flexible Bond and Pimco Total Return 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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.