Correlation Between Dunham High and Nuveen Santa
Can any of the company-specific risk be diversified away by investing in both Dunham High and Nuveen Santa 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 High and Nuveen Santa into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dunham High Yield and Nuveen Santa Barbara, you can compare the effects of market volatilities on Dunham High and Nuveen Santa 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 High with a short position of Nuveen Santa. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dunham High and Nuveen Santa.
Diversification Opportunities for Dunham High and Nuveen Santa
0.49 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Dunham and Nuveen is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding Dunham High Yield and Nuveen Santa Barbara in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nuveen Santa Barbara and Dunham High 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 High Yield are associated (or correlated) with Nuveen Santa. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nuveen Santa Barbara has no effect on the direction of Dunham High i.e., Dunham High and Nuveen Santa go up and down completely randomly.
Pair Corralation between Dunham High and Nuveen Santa
Assuming the 90 days horizon Dunham High Yield is expected to generate 0.2 times more return on investment than Nuveen Santa. However, Dunham High Yield is 5.07 times less risky than Nuveen Santa. It trades about -0.26 of its potential returns per unit of risk. Nuveen Santa Barbara is currently generating about -0.28 per unit of risk. If you would invest 879.00 in Dunham High Yield on October 9, 2024 and sell it today you would lose (12.00) from holding Dunham High Yield or give up 1.37% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dunham High Yield vs. Nuveen Santa Barbara
Performance |
| Timeline |
| Dunham High Yield |
| Nuveen Santa Barbara |
Dunham High and Nuveen Santa Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dunham High and Nuveen Santa
The main advantage of trading using opposite Dunham High and Nuveen Santa positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dunham High position performs unexpectedly, Nuveen Santa 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 Nuveen Santa will offset losses from the drop in Nuveen Santa's long position.| Dunham High vs. Prudential Government Money | Dunham High vs. Cref Money Market | Dunham High vs. Ab Government Exchange | Dunham High vs. Principal Fds Money |
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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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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