Correlation Between Dunham High and Oakmark Select
Can any of the company-specific risk be diversified away by investing in both Dunham High and Oakmark Select 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 High and Oakmark Select into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dunham High Yield and Oakmark Select, you can compare the effects of market volatilities on Dunham High and Oakmark Select 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 High with a short position of Oakmark Select. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dunham High and Oakmark Select.
Diversification Opportunities for Dunham High and Oakmark Select
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Dunham and Oakmark is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Dunham High Yield and Oakmark Select in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Oakmark Select and Dunham High 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 High Yield are associated (or correlated) with Oakmark Select. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Oakmark Select has no effect on the direction of Dunham High i.e., Dunham High and Oakmark Select go up and down completely randomly.
Pair Corralation between Dunham High and Oakmark Select
Assuming the 90 days horizon Dunham High is expected to generate 7.97 times less return on investment than Oakmark Select. But when comparing it to its historical volatility, Dunham High Yield is 6.54 times less risky than Oakmark Select. It trades about 0.22 of its potential returns per unit of risk. Oakmark Select is currently generating about 0.26 of returns per unit of risk over similar time horizon. If you would invest 7,238 in Oakmark Select on September 12, 2024 and sell it today you would earn a total of 1,110 from holding Oakmark Select or generate 15.34% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dunham High Yield vs. Oakmark Select
Performance |
| Timeline |
| Dunham High Yield |
| Oakmark Select |
Dunham High and Oakmark Select Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dunham High and Oakmark Select
The main advantage of trading using opposite Dunham High and Oakmark Select positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dunham High position performs unexpectedly, Oakmark Select 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 Oakmark Select will offset losses from the drop in Oakmark Select's long position.| Dunham High vs. Calvert Global Energy | Dunham High vs. Gmo Resources | Dunham High vs. Tortoise Energy Independence | Dunham High vs. Gamco Natural Resources |
| Oakmark Select vs. Transamerica Financial Life | Oakmark Select vs. Davis Financial Fund | Oakmark Select vs. Financials Ultrasector Profund | Oakmark Select vs. Vanguard Financials Index |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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