Correlation Between Pcm Fund and Cornerstone Strategic

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

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

Diversification Opportunities for Pcm Fund and Cornerstone Strategic

0.04

Correlation Coefficient

Pcm Fund  Cornerstone Strategic

Significant diversification

The 3 months correlation between Pcm and Cornerstone is 0.04. Overlapping area represents the amount of risk that can be diversified away by holding Pcm Fund and Cornerstone Strategic Value in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cornerstone Strategic and Pcm Fund 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 Pcm Fund are associated (or correlated) with Cornerstone Strategic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cornerstone Strategic has no effect on the direction of Pcm Fund i.e., Pcm Fund and Cornerstone Strategic go up and down completely randomly.

Pair Corralation between Pcm Fund and Cornerstone Strategic

Considering the 90-day investment horizon Pcm Fund is expected to under-perform the Cornerstone Strategic. In addition to that, Pcm Fund is 1.31 times more volatile than Cornerstone Strategic Value. It trades about -0.11 of its total potential returns per unit of risk. Cornerstone Strategic Value is currently generating about -0.1 per unit of volatility. If you would invest  815.00  in Cornerstone Strategic Value on December 28, 2024 and sell it today you would lose (76.00) from holding Cornerstone Strategic Value or give up 9.33% of portfolio value over 90 days.

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

Pcm Fund  vs.  Cornerstone Strategic Value

Pcm Fund

Risk-Adjusted Performance

Very Weak

Over the last 90 days Pcm Fund has generated negative risk-adjusted returns adding no value to fund investors. In spite of conflicting performance in the last few months, the Fund's fundamental indicators remain very healthy which may send shares a bit higher in April 2025. The recent disarray may also be a sign of long period up-swing for the fund investors.

Cornerstone Strategic

Risk-Adjusted Performance

Very Weak

Over the last 90 days Cornerstone Strategic Value has generated negative risk-adjusted returns adding no value to fund investors. In spite of latest weak performance, the Fund's essential indicators remain healthy and the recent disarray on Wall Street may also be a sign of long period gains for the fund investors.

Pair Trading with Pcm Fund and Cornerstone Strategic

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

The idea behind Pcm Fund and Cornerstone Strategic Value 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 Equity Valuation module to check real value of public entities based on technical and fundamental data.