Correlation Between Global Gold and Dunham High
Can any of the company-specific risk be diversified away by investing in both Global Gold and Dunham High 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 Global Gold and Dunham High into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Global Gold Fund and Dunham High Yield, you can compare the effects of market volatilities on Global Gold and Dunham High 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 Global Gold with a short position of Dunham High. Check out your portfolio center. Please also check ongoing floating volatility patterns of Global Gold and Dunham High.
Diversification Opportunities for Global Gold and Dunham High
-0.51 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Global and Dunham is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding Global Gold Fund and Dunham High Yield in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dunham High Yield and Global Gold 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 Global Gold Fund are associated (or correlated) with Dunham High. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dunham High Yield has no effect on the direction of Global Gold i.e., Global Gold and Dunham High go up and down completely randomly.
Pair Corralation between Global Gold and Dunham High
Assuming the 90 days horizon Global Gold Fund is expected to under-perform the Dunham High. In addition to that, Global Gold is 9.79 times more volatile than Dunham High Yield. It trades about -0.06 of its total potential returns per unit of risk. Dunham High Yield is currently generating about 0.18 per unit of volatility. If you would invest 856.00 in Dunham High Yield on October 26, 2024 and sell it today you would earn a total of 17.00 from holding Dunham High Yield or generate 1.99% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Global Gold Fund vs. Dunham High Yield
Performance |
| Timeline |
| Global Gold Fund |
| Dunham High Yield |
Global Gold and Dunham High Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Global Gold and Dunham High
The main advantage of trading using opposite Global Gold and Dunham High positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Global Gold position performs unexpectedly, Dunham High 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 Dunham High will offset losses from the drop in Dunham High's long position.| Global Gold vs. Ab Bond Inflation | Global Gold vs. Gmo High Yield | Global Gold vs. Siit High Yield | Global Gold vs. Rbc Ultra Short Fixed |
| Dunham High vs. Touchstone Small Cap | Dunham High vs. Goldman Sachs Smallmid | Dunham High vs. Nuveen Small Cap | Dunham High vs. Df Dent Small |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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