Correlation Between 361 Global and Dodge Cox
Can any of the company-specific risk be diversified away by investing in both 361 Global and Dodge Cox 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 361 Global and Dodge Cox into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between 361 Global Longshort and Dodge Cox Global, you can compare the effects of market volatilities on 361 Global and Dodge Cox 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 361 Global with a short position of Dodge Cox. Check out your portfolio center. Please also check ongoing floating volatility patterns of 361 Global and Dodge Cox.
Diversification Opportunities for 361 Global and Dodge Cox
-0.04 | Correlation Coefficient |
Good diversification
The 3 months correlation between 361 and Dodge is -0.04. Overlapping area represents the amount of risk that can be diversified away by holding 361 Global Longshort and Dodge Cox Global in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dodge Cox Global and 361 Global 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 361 Global Longshort are associated (or correlated) with Dodge Cox. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dodge Cox Global has no effect on the direction of 361 Global i.e., 361 Global and Dodge Cox go up and down completely randomly.
Pair Corralation between 361 Global and Dodge Cox
Assuming the 90 days horizon 361 Global Longshort is expected to under-perform the Dodge Cox. In addition to that, 361 Global is 1.15 times more volatile than Dodge Cox Global. It trades about -0.15 of its total potential returns per unit of risk. Dodge Cox Global is currently generating about 0.24 per unit of volatility. If you would invest 1,085 in Dodge Cox Global on September 13, 2024 and sell it today you would earn a total of 12.00 from holding Dodge Cox Global or generate 1.11% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
361 Global Longshort vs. Dodge Cox Global
Performance |
| Timeline |
| 361 Global Longshort |
| Dodge Cox Global |
361 Global and Dodge Cox Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with 361 Global and Dodge Cox
The main advantage of trading using opposite 361 Global and Dodge Cox positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 361 Global position performs unexpectedly, Dodge Cox 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 Dodge Cox will offset losses from the drop in Dodge Cox's long position.| 361 Global vs. L Abbett Fundamental | 361 Global vs. Nasdaq 100 Index Fund | 361 Global vs. Eic Value Fund | 361 Global vs. Commonwealth Global Fund |
| Dodge Cox vs. Dodge Stock Fund | Dodge Cox vs. Dodge International Stock | Dodge Cox vs. Dodge Cox Emerging | Dodge Cox vs. Dodge Balanced Fund |
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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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