Correlation Between Pimco International and Blackrock

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

By analyzing existing cross correlation between Pimco International Stocksplus and Blackrock Bd Fd, you can compare the effects of market volatilities on Pimco International and Blackrock 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 International with a short position of Blackrock. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pimco International and Blackrock.

Diversification Opportunities for Pimco International and Blackrock

0.66

Correlation Coefficient

Pimco International  Blackrock

Poor diversification

The 3 months correlation between Pimco and Blackrock is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Pimco International Stocksplus and Blackrock Bd Fd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Blackrock Bd Fd and Pimco International 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 International Stocksplus are associated (or correlated) with Blackrock. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Blackrock Bd Fd has no effect on the direction of Pimco International i.e., Pimco International and Blackrock go up and down completely randomly.

Pair Corralation between Pimco International and Blackrock

Assuming the 90 days horizon Pimco International Stocksplus is expected to under-perform the Blackrock. In addition to that, Pimco International is 2.66 times more volatile than Blackrock Bd Fd. It trades about -0.22 of its total potential returns per unit of risk. Blackrock Bd Fd is currently generating about -0.53 per unit of volatility. If you would invest  999.00  in Blackrock Bd Fd on October 7, 2024 and sell it today you would lose (28.00) from holding Blackrock Bd Fd or give up 2.8% of portfolio value over 90 days.

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

Pimco International Stocksplus  vs.  Blackrock Bd Fd

Pimco International

Risk-Adjusted Performance

0 of 100

Very Weak

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

Blackrock Bd Fd

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with Pimco International and Blackrock

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

The idea behind Pimco International Stocksplus and Blackrock Bd Fd 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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.