Correlation Between Dunham Large and Intermediate-term
Can any of the company-specific risk be diversified away by investing in both Dunham Large and Intermediate-term 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 Large and Intermediate-term into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dunham Large Cap and Intermediate Term Bond Fund, you can compare the effects of market volatilities on Dunham Large and Intermediate-term 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 Large with a short position of Intermediate-term. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dunham Large and Intermediate-term.
Diversification Opportunities for Dunham Large and Intermediate-term
0.46 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Dunham and Intermediate-term is 0.46. Overlapping area represents the amount of risk that can be diversified away by holding Dunham Large Cap and Intermediate Term Bond Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Intermediate Term Bond and Dunham Large 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 Large Cap are associated (or correlated) with Intermediate-term. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Intermediate Term Bond has no effect on the direction of Dunham Large i.e., Dunham Large and Intermediate-term go up and down completely randomly.
Pair Corralation between Dunham Large and Intermediate-term
Assuming the 90 days horizon Dunham Large Cap is expected to generate 2.05 times more return on investment than Intermediate-term. However, Dunham Large is 2.05 times more volatile than Intermediate Term Bond Fund. It trades about 0.06 of its potential returns per unit of risk. Intermediate Term Bond Fund is currently generating about 0.05 per unit of risk. If you would invest 1,571 in Dunham Large Cap on December 4, 2024 and sell it today you would earn a total of 393.00 from holding Dunham Large Cap or generate 25.02% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.8% |
| Values | Daily Returns |
Dunham Large Cap vs. Intermediate Term Bond Fund
Performance |
| Timeline |
| Dunham Large Cap |
| Intermediate Term Bond |
Dunham Large and Intermediate-term Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dunham Large and Intermediate-term
The main advantage of trading using opposite Dunham Large and Intermediate-term positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dunham Large position performs unexpectedly, Intermediate-term 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 Intermediate-term will offset losses from the drop in Intermediate-term's long position.| Dunham Large vs. Rbc Short Duration | Dunham Large vs. John Hancock Variable | Dunham Large vs. Transam Short Term Bond | Dunham Large vs. Barings Active Short |
| Intermediate-term vs. Collegeadvantage 529 Savings | Intermediate-term vs. First American Funds | Intermediate-term vs. Jpmorgan Trust I | Intermediate-term vs. Prudential 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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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