Correlation Between Dunham Small and Dunham Us
Can any of the company-specific risk be diversified away by investing in both Dunham Small and Dunham Us 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 Small and Dunham Us into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dunham Small Cap and Dunham Enhanced Market, you can compare the effects of market volatilities on Dunham Small and Dunham Us 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 Small with a short position of Dunham Us. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dunham Small and Dunham Us.
Diversification Opportunities for Dunham Small and Dunham Us
0.94 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Dunham and Dunham is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding Dunham Small Cap and Dunham Enhanced Market in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dunham Enhanced Market and Dunham Small 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 Small Cap are associated (or correlated) with Dunham Us. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dunham Enhanced Market has no effect on the direction of Dunham Small i.e., Dunham Small and Dunham Us go up and down completely randomly.
Pair Corralation between Dunham Small and Dunham Us
Assuming the 90 days horizon Dunham Small Cap is expected to generate 1.43 times more return on investment than Dunham Us. However, Dunham Small is 1.43 times more volatile than Dunham Enhanced Market. It trades about 0.24 of its potential returns per unit of risk. Dunham Enhanced Market is currently generating about 0.2 per unit of risk. If you would invest 1,957 in Dunham Small Cap on August 31, 2024 and sell it today you would earn a total of 154.00 from holding Dunham Small Cap or generate 7.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 95.65% |
| Values | Daily Returns |
Dunham Small Cap vs. Dunham Enhanced Market
Performance |
| Timeline |
| Dunham Small Cap |
| Dunham Enhanced Market |
Dunham Small and Dunham Us Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dunham Small and Dunham Us
The main advantage of trading using opposite Dunham Small and Dunham Us positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dunham Small position performs unexpectedly, Dunham Us 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 Us will offset losses from the drop in Dunham Us' long position.| Dunham Small vs. Dunham Appreciation Income | Dunham Small vs. Dunham Dynamic Macro | Dunham Small vs. Dunham Small Cap | Dunham Small vs. Dunham Emerging Markets |
| Dunham Us vs. Growth Opportunities Fund | Dunham Us vs. Chase Growth Fund | Dunham Us vs. Tfa Alphagen Growth | Dunham Us vs. T Rowe Price |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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