Correlation Between Dunham International and Templeton Global
Can any of the company-specific risk be diversified away by investing in both Dunham International and Templeton Global 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 International and Templeton Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dunham International Opportunity and Templeton Global Bond, you can compare the effects of market volatilities on Dunham International and Templeton Global 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 International with a short position of Templeton Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dunham International and Templeton Global.
Diversification Opportunities for Dunham International and Templeton Global
-0.21 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Dunham and Templeton is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding Dunham International Opportuni and Templeton Global Bond in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Templeton Global Bond and Dunham International 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 International Opportunity are associated (or correlated) with Templeton Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Templeton Global Bond has no effect on the direction of Dunham International i.e., Dunham International and Templeton Global go up and down completely randomly.
Pair Corralation between Dunham International and Templeton Global
Assuming the 90 days horizon Dunham International Opportunity is expected to generate 0.43 times more return on investment than Templeton Global. However, Dunham International Opportunity is 2.33 times less risky than Templeton Global. It trades about 0.16 of its potential returns per unit of risk. Templeton Global Bond is currently generating about -0.02 per unit of risk. If you would invest 687.00 in Dunham International Opportunity on September 1, 2024 and sell it today you would earn a total of 108.00 from holding Dunham International Opportunity or generate 15.72% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dunham International Opportuni vs. Templeton Global Bond
Performance |
| Timeline |
| Dunham International |
| Templeton Global Bond |
Dunham International and Templeton Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dunham International and Templeton Global
The main advantage of trading using opposite Dunham International and Templeton Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dunham International position performs unexpectedly, Templeton Global 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 Templeton Global will offset losses from the drop in Templeton Global's long position.| Dunham International vs. Templeton Global Bond | Dunham International vs. Capital World Bond | Dunham International vs. Capital World Bond | Dunham International vs. Capital World Bond |
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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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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