Correlation Between Dunham Corporate/govern and Fidelity Series
Can any of the company-specific risk be diversified away by investing in both Dunham Corporate/govern and Fidelity Series 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 Dunham Corporate/govern and Fidelity Series into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dunham Porategovernment Bond and Fidelity Series Government, you can compare the effects of market volatilities on Dunham Corporate/govern and Fidelity Series 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 Dunham Corporate/govern with a short position of Fidelity Series. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dunham Corporate/govern and Fidelity Series.
Diversification Opportunities for Dunham Corporate/govern and Fidelity Series
0.99 | Correlation Coefficient |
No risk reduction
The 3 months correlation between Dunham and Fidelity is 0.99. Overlapping area represents the amount of risk that can be diversified away by holding Dunham Porategovernment Bond and Fidelity Series Government in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fidelity Series Gove and Dunham Corporate/govern 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 Dunham Porategovernment Bond are associated (or correlated) with Fidelity Series. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fidelity Series Gove has no effect on the direction of Dunham Corporate/govern i.e., Dunham Corporate/govern and Fidelity Series go up and down completely randomly.
Pair Corralation between Dunham Corporate/govern and Fidelity Series
Assuming the 90 days horizon Dunham Porategovernment Bond is expected to generate 0.9 times more return on investment than Fidelity Series. However, Dunham Porategovernment Bond is 1.11 times less risky than Fidelity Series. It trades about 0.11 of its potential returns per unit of risk. Fidelity Series Government is currently generating about -0.08 per unit of risk. If you would invest 1,254 in Dunham Porategovernment Bond on August 28, 2024 and sell it today you would earn a total of 8.00 from holding Dunham Porategovernment Bond or generate 0.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dunham Porategovernment Bond vs. Fidelity Series Government
Performance |
| Timeline |
| Dunham Porategovernment |
| Fidelity Series Gove |
Dunham Corporate/govern and Fidelity Series Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dunham Corporate/govern and Fidelity Series
The main advantage of trading using opposite Dunham Corporate/govern and Fidelity Series positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dunham Corporate/govern position performs unexpectedly, Fidelity Series 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 Fidelity Series will offset losses from the drop in Fidelity Series' long position.| Dunham Corporate/govern vs. Dunham Dynamic Macro | Dunham Corporate/govern vs. Dunham Appreciation Income | Dunham Corporate/govern vs. Dunham Small Cap | Dunham Corporate/govern vs. Dunham Emerging Markets |
| Fidelity Series vs. Fidelity Short Term Treasury | Fidelity Series vs. Fidelity Inflation Protected Bond | Fidelity Series vs. Fidelity Long Term Treasury | Fidelity Series vs. Fidelity Emerging Markets |
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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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