Correlation Between Dunham Real and Federated Mdt
Can any of the company-specific risk be diversified away by investing in both Dunham Real and Federated Mdt 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 Federated Mdt 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 Federated Mdt Balanced, you can compare the effects of market volatilities on Dunham Real and Federated Mdt 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 Federated Mdt. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dunham Real and Federated Mdt.
Diversification Opportunities for Dunham Real and Federated Mdt
0.36 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Dunham and Federated is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding Dunham Real Estate and Federated Mdt Balanced in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Federated Mdt Balanced 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 Federated Mdt. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Federated Mdt Balanced has no effect on the direction of Dunham Real i.e., Dunham Real and Federated Mdt go up and down completely randomly.
Pair Corralation between Dunham Real and Federated Mdt
Assuming the 90 days horizon Dunham Real is expected to generate 1.33 times less return on investment than Federated Mdt. In addition to that, Dunham Real is 2.24 times more volatile than Federated Mdt Balanced. It trades about 0.04 of its total potential returns per unit of risk. Federated Mdt Balanced is currently generating about 0.11 per unit of volatility. If you would invest 1,804 in Federated Mdt Balanced on September 4, 2024 and sell it today you would earn a total of 623.00 from holding Federated Mdt Balanced or generate 34.53% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dunham Real Estate vs. Federated Mdt Balanced
Performance |
| Timeline |
| Dunham Real Estate |
| Federated Mdt Balanced |
Dunham Real and Federated Mdt Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dunham Real and Federated Mdt
The main advantage of trading using opposite Dunham Real and Federated Mdt positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dunham Real position performs unexpectedly, Federated Mdt 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 Federated Mdt will offset losses from the drop in Federated Mdt's long position.| Dunham Real vs. T Rowe Price | Dunham Real vs. T Rowe Price | Dunham Real vs. T Rowe Price | Dunham Real vs. T Rowe Price |
| Federated Mdt vs. Gabelli Global Financial | Federated Mdt vs. Davis Financial Fund | Federated Mdt vs. Financials Ultrasector Profund | Federated Mdt vs. Prudential Financial Services |
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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