Correlation Between Pcm Fund and Guggenheim Strategic

Can any of the company-specific risk be diversified away by investing in both Pcm Fund and Guggenheim 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 Guggenheim 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 Guggenheim Strategic Opportunities, you can compare the effects of market volatilities on Pcm Fund and Guggenheim 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 Guggenheim Strategic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pcm Fund and Guggenheim Strategic.

Diversification Opportunities for Pcm Fund and Guggenheim Strategic

-0.28

Correlation Coefficient

Pcm Fund  Guggenheim Strategic

Very good diversification

The 3 months correlation between Pcm and Guggenheim is -0.28. Overlapping area represents the amount of risk that can be diversified away by holding Pcm Fund and Guggenheim Strategic Opportuni in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guggenheim 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 Guggenheim Strategic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guggenheim Strategic has no effect on the direction of Pcm Fund i.e., Pcm Fund and Guggenheim Strategic go up and down completely randomly.

Pair Corralation between Pcm Fund and Guggenheim Strategic

Considering the 90-day investment horizon Pcm Fund is expected to under-perform the Guggenheim Strategic. In addition to that, Pcm Fund is 3.12 times more volatile than Guggenheim Strategic Opportunities. It trades about -0.14 of its total potential returns per unit of risk. Guggenheim Strategic Opportunities is currently generating about 0.09 per unit of volatility. If you would invest  1,525  in Guggenheim Strategic Opportunities on November 28, 2024 and sell it today you would earn a total of  50.00  from holding Guggenheim Strategic Opportunities or generate 3.28% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	98.31%
Values	Daily Returns

Pcm Fund  vs.  Guggenheim Strategic Opportuni

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 weak performance in the last few months, the Fund's fundamental indicators remain very healthy which may send shares a bit higher in March 2025. The recent disarray may also be a sign of long period up-swing for the fund investors.

Guggenheim Strategic

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Guggenheim Strategic Opportunities are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable basic indicators, Guggenheim Strategic is not utilizing all of its potentials. The recent stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Pcm Fund and Guggenheim Strategic

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

The idea behind Pcm Fund and Guggenheim Strategic Opportunities 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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.