Correlation Between Dunham Floating and Dunham Emerging
Can any of the company-specific risk be diversified away by investing in both Dunham Floating and Dunham Emerging 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 Floating and Dunham Emerging into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dunham Floating Rate and Dunham Emerging Markets, you can compare the effects of market volatilities on Dunham Floating and Dunham Emerging 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 Floating with a short position of Dunham Emerging. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dunham Floating and Dunham Emerging.
Diversification Opportunities for Dunham Floating and Dunham Emerging
-0.15 | Correlation Coefficient |
Good diversification
The 3 months correlation between Dunham and Dunham is -0.15. Overlapping area represents the amount of risk that can be diversified away by holding Dunham Floating Rate and Dunham Emerging Markets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dunham Emerging Markets and Dunham Floating 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 Floating Rate are associated (or correlated) with Dunham Emerging. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dunham Emerging Markets has no effect on the direction of Dunham Floating i.e., Dunham Floating and Dunham Emerging go up and down completely randomly.
Pair Corralation between Dunham Floating and Dunham Emerging
Assuming the 90 days horizon Dunham Floating Rate is expected to generate 0.14 times more return on investment than Dunham Emerging. However, Dunham Floating Rate is 7.24 times less risky than Dunham Emerging. It trades about 0.14 of its potential returns per unit of risk. Dunham Emerging Markets is currently generating about -0.17 per unit of risk. If you would invest 865.00 in Dunham Floating Rate on September 3, 2024 and sell it today you would earn a total of 3.00 from holding Dunham Floating Rate or generate 0.35% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dunham Floating Rate vs. Dunham Emerging Markets
Performance |
| Timeline |
| Dunham Floating Rate |
| Dunham Emerging Markets |
Dunham Floating and Dunham Emerging Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dunham Floating and Dunham Emerging
The main advantage of trading using opposite Dunham Floating and Dunham Emerging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dunham Floating position performs unexpectedly, Dunham Emerging 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 Emerging will offset losses from the drop in Dunham Emerging's long position.| Dunham Floating vs. Ftfa Franklin Templeton Growth | Dunham Floating vs. Rational Defensive Growth | Dunham Floating vs. L Abbett Growth | Dunham Floating vs. Goldman Sachs Growth |
| Dunham Emerging vs. Maryland Short Term Tax Free | Dunham Emerging vs. Ab Select Longshort | Dunham Emerging vs. Limited Term Tax | Dunham Emerging vs. Siit Ultra Short |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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