Correlation Between Dunham Monthly and Pimco California
Can any of the company-specific risk be diversified away by investing in both Dunham Monthly and Pimco California 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 Monthly and Pimco California into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dunham Monthly Distribution and Pimco California Municipal, you can compare the effects of market volatilities on Dunham Monthly and Pimco California 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 Monthly with a short position of Pimco California. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dunham Monthly and Pimco California.
Diversification Opportunities for Dunham Monthly and Pimco California
-0.78 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Dunham and Pimco is -0.78. Overlapping area represents the amount of risk that can be diversified away by holding Dunham Monthly Distribution and Pimco California Municipal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pimco California Mun and Dunham Monthly 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 Monthly Distribution are associated (or correlated) with Pimco California. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pimco California Mun has no effect on the direction of Dunham Monthly i.e., Dunham Monthly and Pimco California go up and down completely randomly.
Pair Corralation between Dunham Monthly and Pimco California
Assuming the 90 days horizon Dunham Monthly Distribution is expected to generate 0.17 times more return on investment than Pimco California. However, Dunham Monthly Distribution is 5.81 times less risky than Pimco California. It trades about 0.48 of its potential returns per unit of risk. Pimco California Municipal is currently generating about -0.14 per unit of risk. If you would invest 2,695 in Dunham Monthly Distribution on October 20, 2024 and sell it today you would earn a total of 32.00 from holding Dunham Monthly Distribution or generate 1.19% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dunham Monthly Distribution vs. Pimco California Municipal
Performance |
| Timeline |
| Dunham Monthly Distr |
| Pimco California Mun |
Dunham Monthly and Pimco California Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dunham Monthly and Pimco California
The main advantage of trading using opposite Dunham Monthly and Pimco California positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dunham Monthly position performs unexpectedly, Pimco California 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 Pimco California will offset losses from the drop in Pimco California's long position.| Dunham Monthly vs. Fidelity Advisor Health | Dunham Monthly vs. Blackrock Health Sciences | Dunham Monthly vs. Baron Health Care | Dunham Monthly vs. Invesco Global Health |
| Pimco California vs. Pimco California Municipal | Pimco California vs. Nuveen California Amt | Pimco California vs. Eaton Vance California | Pimco California vs. Invesco California Value |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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