Correlation Between Buffalo Flexible and Dodge Cox
Can any of the company-specific risk be diversified away by investing in both Buffalo Flexible 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 Buffalo Flexible and Dodge Cox into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Buffalo Flexible Income and Dodge Cox Stock, you can compare the effects of market volatilities on Buffalo Flexible 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 Buffalo Flexible with a short position of Dodge Cox. Check out your portfolio center. Please also check ongoing floating volatility patterns of Buffalo Flexible and Dodge Cox.
Diversification Opportunities for Buffalo Flexible and Dodge Cox
0.51 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Buffalo and Dodge is 0.51. Overlapping area represents the amount of risk that can be diversified away by holding Buffalo Flexible Income and Dodge Cox Stock in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dodge Cox Stock and Buffalo Flexible 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 Buffalo Flexible Income 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 Stock has no effect on the direction of Buffalo Flexible i.e., Buffalo Flexible and Dodge Cox go up and down completely randomly.
Pair Corralation between Buffalo Flexible and Dodge Cox
Assuming the 90 days horizon Buffalo Flexible Income is expected to under-perform the Dodge Cox. But the mutual fund apears to be less risky and, when comparing its historical volatility, Buffalo Flexible Income is 1.32 times less risky than Dodge Cox. The mutual fund trades about -0.01 of its potential returns per unit of risk. The Dodge Cox Stock is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest 26,607 in Dodge Cox Stock on September 12, 2024 and sell it today you would earn a total of 1,523 from holding Dodge Cox Stock or generate 5.72% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Buffalo Flexible Income vs. Dodge Cox Stock
Performance |
| Timeline |
| Buffalo Flexible Income |
| Dodge Cox Stock |
Buffalo Flexible and Dodge Cox Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Buffalo Flexible and Dodge Cox
The main advantage of trading using opposite Buffalo Flexible and Dodge Cox positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Buffalo Flexible 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.| Buffalo Flexible vs. Vanguard Value Index | Buffalo Flexible vs. Dodge Cox Stock | Buffalo Flexible vs. American Mutual Fund | Buffalo Flexible vs. American Funds American |
| Dodge Cox vs. Needham Aggressive Growth | Dodge Cox vs. Alliancebernstein Global High | Dodge Cox vs. Ppm High Yield | Dodge Cox vs. Siit High Yield |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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