Correlation Between Pimco Income and Westcore Flexible

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

By analyzing existing cross correlation between Pimco Income Strategy and Westcore Flexible Income, you can compare the effects of market volatilities on Pimco Income and Westcore Flexible 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 Income with a short position of Westcore Flexible. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pimco Income and Westcore Flexible.

Diversification Opportunities for Pimco Income and Westcore Flexible

0.13

Correlation Coefficient

Pimco Income  Westcore Flexible

Average diversification

The 3 months correlation between Pimco and Westcore is 0.13. Overlapping area represents the amount of risk that can be diversified away by holding Pimco Income Strategy and Westcore Flexible Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Westcore Flexible Income and Pimco Income 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 Income Strategy are associated (or correlated) with Westcore Flexible. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Westcore Flexible Income has no effect on the direction of Pimco Income i.e., Pimco Income and Westcore Flexible go up and down completely randomly.

Pair Corralation between Pimco Income and Westcore Flexible

Considering the 90-day investment horizon Pimco Income Strategy is expected to generate 2.9 times more return on investment than Westcore Flexible. However, Pimco Income is 2.9 times more volatile than Westcore Flexible Income. It trades about 0.18 of its potential returns per unit of risk. Westcore Flexible Income is currently generating about 0.1 per unit of risk. If you would invest  725.00  in Pimco Income Strategy on September 12, 2024 and sell it today you would earn a total of  32.00  from holding Pimco Income Strategy or generate 4.41% return on investment over 90 days.

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

Pimco Income Strategy  vs.  Westcore Flexible Income

Pimco Income Strategy

Risk-Adjusted Performance

14 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Pimco Income Strategy are ranked lower than 14 (%) of all funds and portfolios of funds over the last 90 days. In spite of very healthy technical and fundamental indicators, Pimco Income is not utilizing all of its potentials. The recent stock price disarray, may contribute to short-term losses for the investors.

Westcore Flexible Income

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Westcore Flexible Income are ranked lower than 7 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, Westcore Flexible 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 Income and Westcore Flexible

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

The idea behind Pimco Income Strategy and Westcore Flexible Income 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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.