Correlation Between Dunham Real and Clearbridge Small
Can any of the company-specific risk be diversified away by investing in both Dunham Real and Clearbridge Small 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 Real and Clearbridge Small into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dunham Real Estate and Clearbridge Small Cap, you can compare the effects of market volatilities on Dunham Real and Clearbridge Small 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 Real with a short position of Clearbridge Small. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dunham Real and Clearbridge Small.
Diversification Opportunities for Dunham Real and Clearbridge Small
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Dunham and Clearbridge is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Dunham Real Estate and Clearbridge Small Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Clearbridge Small Cap and Dunham Real 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 Real Estate are associated (or correlated) with Clearbridge Small. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Clearbridge Small Cap has no effect on the direction of Dunham Real i.e., Dunham Real and Clearbridge Small go up and down completely randomly.
Pair Corralation between Dunham Real and Clearbridge Small
Assuming the 90 days horizon Dunham Real Estate is expected to under-perform the Clearbridge Small. But the mutual fund apears to be less risky and, when comparing its historical volatility, Dunham Real Estate is 1.17 times less risky than Clearbridge Small. The mutual fund trades about -0.08 of its potential returns per unit of risk. The Clearbridge Small Cap is currently generating about -0.03 of returns per unit of risk over similar time horizon. If you would invest 6,669 in Clearbridge Small Cap on November 27, 2024 and sell it today you would lose (241.00) from holding Clearbridge Small Cap or give up 3.61% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dunham Real Estate vs. Clearbridge Small Cap
Performance |
| Timeline |
| Dunham Real Estate |
| Clearbridge Small Cap |
Dunham Real and Clearbridge Small Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dunham Real and Clearbridge Small
The main advantage of trading using opposite Dunham Real and Clearbridge Small positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dunham Real position performs unexpectedly, Clearbridge Small 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 Clearbridge Small will offset losses from the drop in Clearbridge Small's long position.| Dunham Real vs. Aqr Diversified Arbitrage | Dunham Real vs. Guidepath Conservative Income | Dunham Real vs. Massmutual Premier Diversified | Dunham Real vs. Global Diversified Income |
| Clearbridge Small vs. Goldman Sachs Emerging | Clearbridge Small vs. The Hartford Emerging | Clearbridge Small vs. Jpmorgan Emerging Markets | Clearbridge Small vs. Gmo 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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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