Correlation Between Avantis Us and Dunham Large
Can any of the company-specific risk be diversified away by investing in both Avantis Us and Dunham Large 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 Avantis Us and Dunham Large into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Avantis Large Cap and Dunham Large Cap, you can compare the effects of market volatilities on Avantis Us and Dunham Large 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 Avantis Us with a short position of Dunham Large. Check out your portfolio center. Please also check ongoing floating volatility patterns of Avantis Us and Dunham Large.
Diversification Opportunities for Avantis Us and Dunham Large
0.98 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Avantis and Dunham is 0.98. Overlapping area represents the amount of risk that can be diversified away by holding Avantis Large Cap and Dunham Large Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dunham Large Cap and Avantis Us 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 Avantis Large Cap are associated (or correlated) with Dunham Large. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dunham Large Cap has no effect on the direction of Avantis Us i.e., Avantis Us and Dunham Large go up and down completely randomly.
Pair Corralation between Avantis Us and Dunham Large
Assuming the 90 days horizon Avantis Large Cap is expected to generate 1.29 times more return on investment than Dunham Large. However, Avantis Us is 1.29 times more volatile than Dunham Large Cap. It trades about 0.12 of its potential returns per unit of risk. Dunham Large Cap is currently generating about 0.14 per unit of risk. If you would invest 1,333 in Avantis Large Cap on September 3, 2024 and sell it today you would earn a total of 204.00 from holding Avantis Large Cap or generate 15.3% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Avantis Large Cap vs. Dunham Large Cap
Performance |
| Timeline |
| Avantis Large Cap |
| Dunham Large Cap |
Avantis Us and Dunham Large Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Avantis Us and Dunham Large
The main advantage of trading using opposite Avantis Us and Dunham Large positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Avantis Us position performs unexpectedly, Dunham Large 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 Large will offset losses from the drop in Dunham Large's long position.| Avantis Us vs. Aqr Long Short Equity | Avantis Us vs. Rbc Short Duration | Avantis Us vs. Goldman Sachs Short | Avantis Us vs. Ab Select Longshort |
| Dunham Large vs. Ab Bond Inflation | Dunham Large vs. Tiaa Cref Inflation Linked Bond | Dunham Large vs. Western Asset Inflation | Dunham Large vs. Oklahoma College Savings |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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