Correlation Between Dunham Emerging and Harbor Convertible
Can any of the company-specific risk be diversified away by investing in both Dunham Emerging and Harbor Convertible 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 Emerging and Harbor Convertible into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dunham Emerging Markets and Harbor Vertible Securities, you can compare the effects of market volatilities on Dunham Emerging and Harbor Convertible 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 Emerging with a short position of Harbor Convertible. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dunham Emerging and Harbor Convertible.
Diversification Opportunities for Dunham Emerging and Harbor Convertible
-0.33 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Dunham and Harbor is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding Dunham Emerging Markets and Harbor Vertible Securities in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Harbor Vertible Secu and Dunham Emerging 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 Emerging Markets are associated (or correlated) with Harbor Convertible. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Harbor Vertible Secu has no effect on the direction of Dunham Emerging i.e., Dunham Emerging and Harbor Convertible go up and down completely randomly.
Pair Corralation between Dunham Emerging and Harbor Convertible
Assuming the 90 days horizon Dunham Emerging Markets is expected to under-perform the Harbor Convertible. In addition to that, Dunham Emerging is 1.75 times more volatile than Harbor Vertible Securities. It trades about -0.17 of its total potential returns per unit of risk. Harbor Vertible Securities is currently generating about 0.71 per unit of volatility. If you would invest 1,127 in Harbor Vertible Securities on September 3, 2024 and sell it today you would earn a total of 87.00 from holding Harbor Vertible Securities or generate 7.72% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dunham Emerging Markets vs. Harbor Vertible Securities
Performance |
| Timeline |
| Dunham Emerging Markets |
| Harbor Vertible Secu |
Dunham Emerging and Harbor Convertible Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dunham Emerging and Harbor Convertible
The main advantage of trading using opposite Dunham Emerging and Harbor Convertible positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dunham Emerging position performs unexpectedly, Harbor Convertible 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 Harbor Convertible will offset losses from the drop in Harbor Convertible's long position.| Dunham Emerging vs. Mondrian Emerging Markets | Dunham Emerging vs. The Emerging Markets | Dunham Emerging vs. Dodge Cox Emerging | Dunham Emerging vs. Ep Emerging Markets |
| Harbor Convertible vs. Arrow Managed Futures | Harbor Convertible vs. Lord Abbett Inflation | Harbor Convertible vs. Oklahoma College Savings | Harbor Convertible vs. Tiaa Cref Inflation Linked Bond |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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