Correlation Between Dunham Real and Aqr Tm
Can any of the company-specific risk be diversified away by investing in both Dunham Real and Aqr Tm 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 Aqr Tm 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 Aqr Tm Emerging, you can compare the effects of market volatilities on Dunham Real and Aqr Tm 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 Aqr Tm. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dunham Real and Aqr Tm.
Diversification Opportunities for Dunham Real and Aqr Tm
0.49 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Dunham and Aqr is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding Dunham Real Estate and Aqr Tm Emerging in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aqr Tm Emerging 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 Aqr Tm. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aqr Tm Emerging has no effect on the direction of Dunham Real i.e., Dunham Real and Aqr Tm go up and down completely randomly.
Pair Corralation between Dunham Real and Aqr Tm
Assuming the 90 days horizon Dunham Real is expected to generate 1.06 times less return on investment than Aqr Tm. In addition to that, Dunham Real is 1.26 times more volatile than Aqr Tm Emerging. It trades about 0.04 of its total potential returns per unit of risk. Aqr Tm Emerging is currently generating about 0.05 per unit of volatility. If you would invest 855.00 in Aqr Tm Emerging on September 2, 2024 and sell it today you would earn a total of 227.00 from holding Aqr Tm Emerging or generate 26.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dunham Real Estate vs. Aqr Tm Emerging
Performance |
| Timeline |
| Dunham Real Estate |
| Aqr Tm Emerging |
Dunham Real and Aqr Tm Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dunham Real and Aqr Tm
The main advantage of trading using opposite Dunham Real and Aqr Tm positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dunham Real position performs unexpectedly, Aqr Tm 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 Aqr Tm will offset losses from the drop in Aqr Tm's long position.| Dunham Real vs. Government Securities Fund | Dunham Real vs. Franklin Adjustable Government | Dunham Real vs. Goldman Sachs Government | Dunham Real vs. Virtus Seix Government |
| Aqr Tm vs. Aqr Large Cap | Aqr Tm vs. Aqr Large Cap | Aqr Tm vs. Aqr International Defensive | Aqr Tm vs. Aqr International Defensive |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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