Correlation Between Dunham Large and Bny Mellon
Can any of the company-specific risk be diversified away by investing in both Dunham Large and Bny Mellon 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 Large and Bny Mellon into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dunham Large Cap and Bny Mellon Income, you can compare the effects of market volatilities on Dunham Large and Bny Mellon 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 Large with a short position of Bny Mellon. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dunham Large and Bny Mellon.
Diversification Opportunities for Dunham Large and Bny Mellon
0.98 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Dunham and Bny is 0.98. Overlapping area represents the amount of risk that can be diversified away by holding Dunham Large Cap and Bny Mellon Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bny Mellon Income and Dunham Large 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 Large Cap are associated (or correlated) with Bny Mellon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bny Mellon Income has no effect on the direction of Dunham Large i.e., Dunham Large and Bny Mellon go up and down completely randomly.
Pair Corralation between Dunham Large and Bny Mellon
Assuming the 90 days horizon Dunham Large Cap is expected to generate 0.84 times more return on investment than Bny Mellon. However, Dunham Large Cap is 1.19 times less risky than Bny Mellon. It trades about 0.36 of its potential returns per unit of risk. Bny Mellon Income is currently generating about 0.28 per unit of risk. If you would invest 1,881 in Dunham Large Cap on September 1, 2024 and sell it today you would earn a total of 102.00 from holding Dunham Large Cap or generate 5.42% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 95.45% |
| Values | Daily Returns |
Dunham Large Cap vs. Bny Mellon Income
Performance |
| Timeline |
| Dunham Large Cap |
| Bny Mellon Income |
Dunham Large and Bny Mellon Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dunham Large and Bny Mellon
The main advantage of trading using opposite Dunham Large and Bny Mellon positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dunham Large position performs unexpectedly, Bny Mellon 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 Bny Mellon will offset losses from the drop in Bny Mellon's long position.| Dunham Large vs. Dunham Dynamic Macro | Dunham Large vs. Dunham Appreciation Income | Dunham Large vs. Dunham Small Cap | Dunham Large vs. Dunham Emerging Markets |
| Bny Mellon vs. John Hancock Investment | Bny Mellon vs. T Rowe Price | Bny Mellon vs. M Large Cap | Bny Mellon vs. Dunham Large Cap |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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