Correlation Between Dunham Dynamic and Dunham Emerging
Can any of the company-specific risk be diversified away by investing in both Dunham Dynamic and Dunham Emerging 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 Dynamic and Dunham Emerging into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dunham Dynamic Macro and Dunham Emerging Markets, you can compare the effects of market volatilities on Dunham Dynamic and Dunham Emerging 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 Dynamic with a short position of Dunham Emerging. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dunham Dynamic and Dunham Emerging.
Diversification Opportunities for Dunham Dynamic and Dunham Emerging
0.5 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Dunham and Dunham is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding Dunham Dynamic Macro and Dunham Emerging Markets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dunham Emerging Markets and Dunham Dynamic 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 Dynamic Macro are associated (or correlated) with Dunham Emerging. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dunham Emerging Markets has no effect on the direction of Dunham Dynamic i.e., Dunham Dynamic and Dunham Emerging go up and down completely randomly.
Pair Corralation between Dunham Dynamic and Dunham Emerging
Assuming the 90 days horizon Dunham Dynamic Macro is expected to generate 0.23 times more return on investment than Dunham Emerging. However, Dunham Dynamic Macro is 4.29 times less risky than Dunham Emerging. It trades about 0.29 of its potential returns per unit of risk. Dunham Emerging Markets is currently generating about -0.17 per unit of risk. If you would invest 1,238 in Dunham Dynamic Macro on September 3, 2024 and sell it today you would earn a total of 15.00 from holding Dunham Dynamic Macro or generate 1.21% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dunham Dynamic Macro vs. Dunham Emerging Markets
Performance |
| Timeline |
| Dunham Dynamic Macro |
| Dunham Emerging Markets |
Dunham Dynamic and Dunham Emerging Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dunham Dynamic and Dunham Emerging
The main advantage of trading using opposite Dunham Dynamic and Dunham Emerging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dunham Dynamic position performs unexpectedly, Dunham Emerging 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 Dunham Emerging will offset losses from the drop in Dunham Emerging's long position.| Dunham Dynamic vs. Virtus Dfa 2040 | Dunham Dynamic vs. T Rowe Price | Dunham Dynamic vs. John Hancock Funds | Dunham Dynamic vs. Legg Mason Partners |
| Dunham Emerging vs. Maryland Short Term Tax Free | Dunham Emerging vs. Ab Select Longshort | Dunham Emerging vs. Limited Term Tax | Dunham Emerging vs. Siit Ultra Short |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
Other Complementary Tools
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals |