Correlation Between PIMCO Access and Pimco Strategic

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

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

Diversification Opportunities for PIMCO Access and Pimco Strategic

0.6

Correlation Coefficient

PIMCO Access  Pimco Strategic

Poor diversification

The 3 months correlation between PIMCO and Pimco is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding PIMCO Access Income and Pimco Strategic Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pimco Strategic Income and PIMCO Access 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 Access Income are associated (or correlated) with Pimco Strategic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pimco Strategic Income has no effect on the direction of PIMCO Access i.e., PIMCO Access and Pimco Strategic go up and down completely randomly.

Pair Corralation between PIMCO Access and Pimco Strategic

Given the investment horizon of 90 days PIMCO Access is expected to generate 2.04 times less return on investment than Pimco Strategic. But when comparing it to its historical volatility, PIMCO Access Income is 1.37 times less risky than Pimco Strategic. It trades about 0.06 of its potential returns per unit of risk. Pimco Strategic Income is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest  440.00  in Pimco Strategic Income on September 2, 2024 and sell it today you would earn a total of  344.00  from holding Pimco Strategic Income or generate 78.18% return on investment over 90 days.

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

PIMCO Access Income  vs.  Pimco Strategic Income

PIMCO Access Income

Risk-Adjusted Performance

11 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in PIMCO Access Income are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively abnormal basic indicators, PIMCO Access may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pimco Strategic Income

Risk-Adjusted Performance

17 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Pimco Strategic Income are ranked lower than 17 (%) of all funds and portfolios of funds over the last 90 days. In spite of comparatively unfluctuating fundamental indicators, Pimco Strategic unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with PIMCO Access and Pimco Strategic

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

The idea behind PIMCO Access Income and Pimco Strategic 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.

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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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.