Correlation Between Pimco Trends and Acadian Emerging
Can any of the company-specific risk be diversified away by investing in both Pimco Trends and Acadian Emerging 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 Trends and Acadian Emerging into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Pimco Trends Managed and Acadian Emerging Markets, you can compare the effects of market volatilities on Pimco Trends and Acadian Emerging 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 Trends with a short position of Acadian Emerging. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pimco Trends and Acadian Emerging.
Diversification Opportunities for Pimco Trends and Acadian Emerging
-0.43 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Pimco and Acadian is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding Pimco Trends Managed and Acadian Emerging Markets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Acadian Emerging Markets and Pimco Trends 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 Trends Managed are associated (or correlated) with Acadian Emerging. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Acadian Emerging Markets has no effect on the direction of Pimco Trends i.e., Pimco Trends and Acadian Emerging go up and down completely randomly.
Pair Corralation between Pimco Trends and Acadian Emerging
Assuming the 90 days horizon Pimco Trends Managed is expected to under-perform the Acadian Emerging. But the mutual fund apears to be less risky and, when comparing its historical volatility, Pimco Trends Managed is 1.63 times less risky than Acadian Emerging. The mutual fund trades about -0.17 of its potential returns per unit of risk. The Acadian Emerging Markets is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 2,244 in Acadian Emerging Markets on December 3, 2024 and sell it today you would earn a total of 28.00 from holding Acadian Emerging Markets or generate 1.25% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Pimco Trends Managed vs. Acadian Emerging Markets
Performance |
Timeline |
Pimco Trends Managed |
Acadian Emerging Markets |
Pimco Trends and Acadian Emerging Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Pimco Trends and Acadian Emerging
The main advantage of trading using opposite Pimco Trends and Acadian Emerging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pimco Trends position performs unexpectedly, Acadian Emerging 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 Acadian Emerging will offset losses from the drop in Acadian Emerging's long position.Pimco Trends vs. Asg Managed Futures | Pimco Trends vs. Asg Managed Futures | Pimco Trends vs. Aqr Managed Futures | Pimco Trends vs. iMGP DBi Managed |
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Check out your portfolio center.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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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