Correlation Between Aa Pimco and Franklin Low

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

By analyzing existing cross correlation between Aa Pimco Tr and Franklin Low Duration, you can compare the effects of market volatilities on Aa Pimco and Franklin Low 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 Aa Pimco with a short position of Franklin Low. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aa Pimco and Franklin Low.

Diversification Opportunities for Aa Pimco and Franklin Low

0.0

Correlation Coefficient

Aa Pimco  Franklin Low

Pay attention - limited upside

The 3 months correlation between PQTIX and Franklin is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Aa Pimco Tr and Franklin Low Duration in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Franklin Low Duration and Aa Pimco 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 Aa Pimco Tr are associated (or correlated) with Franklin Low. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Franklin Low Duration has no effect on the direction of Aa Pimco i.e., Aa Pimco and Franklin Low go up and down completely randomly.

Pair Corralation between Aa Pimco and Franklin Low

If you would invest  1,061  in Aa Pimco Tr on January 26, 2024 and sell it today you would earn a total of  62.00  from holding Aa Pimco Tr or generate 5.84% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Aa Pimco Tr  vs.  Franklin Low Duration

Aa Pimco Tr

Risk-Adjusted Performance

16 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Aa Pimco Tr are ranked lower than 16 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong forward indicators, Aa Pimco is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Franklin Low Duration

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Franklin Low Duration are ranked lower than 1 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, Franklin Low is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Aa Pimco and Franklin Low

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

The idea behind Aa Pimco Tr and Franklin Low Duration 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 Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.