Correlation Between Crossmark Steward and Pimco All

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

By analyzing existing cross correlation between Crossmark Steward Equity and Pimco All Asset, you can compare the effects of market volatilities on Crossmark Steward and Pimco All 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 Crossmark Steward with a short position of Pimco All. Check out your portfolio center. Please also check ongoing floating volatility patterns of Crossmark Steward and Pimco All.

Diversification Opportunities for Crossmark Steward and Pimco All

0.03

Correlation Coefficient

Crossmark Steward  Pimco All

Significant diversification

The 3 months correlation between Crossmark and Pimco is 0.03. Overlapping area represents the amount of risk that can be diversified away by holding Crossmark Steward Equity and Pimco All Asset in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pimco All Asset and Crossmark Steward 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 Crossmark Steward Equity are associated (or correlated) with Pimco All. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pimco All Asset has no effect on the direction of Crossmark Steward i.e., Crossmark Steward and Pimco All go up and down completely randomly.

Pair Corralation between Crossmark Steward and Pimco All

Assuming the 90 days horizon Crossmark Steward Equity is expected to under-perform the Pimco All. In addition to that, Crossmark Steward is 1.25 times more volatile than Pimco All Asset. It trades about -0.11 of its total potential returns per unit of risk. Pimco All Asset is currently generating about -0.07 per unit of volatility. If you would invest  652.00  in Pimco All Asset on October 22, 2024 and sell it today you would lose (11.00) from holding Pimco All Asset or give up 1.69% of portfolio value over 90 days.

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

Crossmark Steward Equity  vs.  Pimco All Asset

Crossmark Steward Equity

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pimco All Asset

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with Crossmark Steward and Pimco All

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

The idea behind Crossmark Steward Equity and Pimco All Asset 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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.