Correlation Between Baird Small/mid and Dunham Real
Can any of the company-specific risk be diversified away by investing in both Baird Small/mid and Dunham Real 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 Baird Small/mid and Dunham Real into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Baird Smallmid Cap and Dunham Real Estate, you can compare the effects of market volatilities on Baird Small/mid and Dunham Real 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 Baird Small/mid with a short position of Dunham Real. Check out your portfolio center. Please also check ongoing floating volatility patterns of Baird Small/mid and Dunham Real.
Diversification Opportunities for Baird Small/mid and Dunham Real
0.24 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Baird and Dunham is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding Baird Smallmid Cap and Dunham Real Estate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dunham Real Estate and Baird Small/mid 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 Baird Smallmid Cap are associated (or correlated) with Dunham Real. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dunham Real Estate has no effect on the direction of Baird Small/mid i.e., Baird Small/mid and Dunham Real go up and down completely randomly.
Pair Corralation between Baird Small/mid and Dunham Real
Assuming the 90 days horizon Baird Small/mid is expected to generate 1.12 times less return on investment than Dunham Real. In addition to that, Baird Small/mid is 1.13 times more volatile than Dunham Real Estate. It trades about 0.11 of its total potential returns per unit of risk. Dunham Real Estate is currently generating about 0.14 per unit of volatility. If you would invest 1,274 in Dunham Real Estate on September 3, 2024 and sell it today you would earn a total of 255.00 from holding Dunham Real Estate or generate 20.02% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Baird Smallmid Cap vs. Dunham Real Estate
Performance |
| Timeline |
| Baird Smallmid Cap |
| Dunham Real Estate |
Baird Small/mid and Dunham Real Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Baird Small/mid and Dunham Real
The main advantage of trading using opposite Baird Small/mid and Dunham Real positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Baird Small/mid position performs unexpectedly, Dunham Real 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 Real will offset losses from the drop in Dunham Real's long position.| Baird Small/mid vs. T Rowe Price | Baird Small/mid vs. T Rowe Price | Baird Small/mid vs. T Rowe Price | Baird Small/mid vs. T Rowe Price |
| Dunham Real vs. Sterling Capital Short | Dunham Real vs. Old Westbury Short Term | Dunham Real vs. Goldman Sachs Short | Dunham Real vs. Jhancock Short Duration |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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