Correlation Between Dunham Emerging and Dunham Floating
Can any of the company-specific risk be diversified away by investing in both Dunham Emerging and Dunham Floating 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 Dunham Floating 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 Dunham Floating Rate, you can compare the effects of market volatilities on Dunham Emerging and Dunham Floating 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 Dunham Floating. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dunham Emerging and Dunham Floating.
Diversification Opportunities for Dunham Emerging and Dunham Floating
-0.17 | Correlation Coefficient |
Good diversification
The 3 months correlation between Dunham and Dunham is -0.17. Overlapping area represents the amount of risk that can be diversified away by holding Dunham Emerging Markets and Dunham Floating Rate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dunham Floating Rate 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 Dunham Floating. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dunham Floating Rate has no effect on the direction of Dunham Emerging i.e., Dunham Emerging and Dunham Floating go up and down completely randomly.
Pair Corralation between Dunham Emerging and Dunham Floating
Assuming the 90 days horizon Dunham Emerging Markets is expected to under-perform the Dunham Floating. In addition to that, Dunham Emerging is 6.49 times more volatile than Dunham Floating Rate. It trades about -0.15 of its total potential returns per unit of risk. Dunham Floating Rate is currently generating about 0.14 per unit of volatility. If you would invest 865.00 in Dunham Floating Rate on August 31, 2024 and sell it today you would earn a total of 4.00 from holding Dunham Floating Rate or generate 0.46% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Dunham Emerging Markets vs. Dunham Floating Rate
Performance |
| Timeline |
| Dunham Emerging Markets |
| Dunham Floating Rate |
Dunham Emerging and Dunham Floating Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dunham Emerging and Dunham Floating
The main advantage of trading using opposite Dunham Emerging and Dunham Floating positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dunham Emerging position performs unexpectedly, Dunham Floating 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 Floating will offset losses from the drop in Dunham Floating's long position.| Dunham Emerging vs. Rbb Fund | Dunham Emerging vs. Western Asset Municipal | Dunham Emerging vs. Leggmason Partners Institutional | Dunham Emerging vs. Ab Value Fund |
| Dunham Floating vs. Rbc Funds Trust | Dunham Floating vs. Balanced Fund Investor | Dunham Floating vs. Shelton Funds | Dunham Floating vs. Small Cap Stock |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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