Correlation Between Dunham Real and Us Strategic
Can any of the company-specific risk be diversified away by investing in both Dunham Real and Us Strategic 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 Us Strategic 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 Us Strategic Equity, you can compare the effects of market volatilities on Dunham Real and Us Strategic 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 Us Strategic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dunham Real and Us Strategic.
Diversification Opportunities for Dunham Real and Us Strategic
0.5 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Dunham and RUSTX is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding Dunham Real Estate and Us Strategic Equity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Us Strategic Equity 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 Us Strategic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Us Strategic Equity has no effect on the direction of Dunham Real i.e., Dunham Real and Us Strategic go up and down completely randomly.
Pair Corralation between Dunham Real and Us Strategic
Assuming the 90 days horizon Dunham Real Estate is expected to generate 0.4 times more return on investment than Us Strategic. However, Dunham Real Estate is 2.51 times less risky than Us Strategic. It trades about -0.4 of its potential returns per unit of risk. Us Strategic Equity is currently generating about -0.19 per unit of risk. If you would invest 1,536 in Dunham Real Estate on September 29, 2024 and sell it today you would lose (134.00) from holding Dunham Real Estate or give up 8.72% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dunham Real Estate vs. Us Strategic Equity
Performance |
| Timeline |
| Dunham Real Estate |
| Us Strategic Equity |
Dunham Real and Us Strategic Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dunham Real and Us Strategic
The main advantage of trading using opposite Dunham Real and Us Strategic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dunham Real position performs unexpectedly, Us Strategic 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 Us Strategic will offset losses from the drop in Us Strategic's long position.| Dunham Real vs. Alliancebernstein Global High | Dunham Real vs. Franklin Mutual Global | Dunham Real vs. Ab Global Bond | Dunham Real vs. Siit Global Managed |
| Us Strategic vs. Dunham Real Estate | Us Strategic vs. Columbia Real Estate | Us Strategic vs. Neuberger Berman Real | Us Strategic vs. Short Real Estate |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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