Correlation Between Dunham Real and Real Estate
Can any of the company-specific risk be diversified away by investing in both Dunham Real and Real Estate 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 Real and Real Estate into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dunham Real Estate and Real Estate Fund, you can compare the effects of market volatilities on Dunham Real and Real Estate 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 Real with a short position of Real Estate. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dunham Real and Real Estate.
Diversification Opportunities for Dunham Real and Real Estate
0.96 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Dunham and Real is 0.96. Overlapping area represents the amount of risk that can be diversified away by holding Dunham Real Estate and Real Estate Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Real Estate Fund and Dunham Real 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 Real Estate are associated (or correlated) with Real Estate. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Real Estate Fund has no effect on the direction of Dunham Real i.e., Dunham Real and Real Estate go up and down completely randomly.
Pair Corralation between Dunham Real and Real Estate
Assuming the 90 days horizon Dunham Real is expected to generate 2.75 times less return on investment than Real Estate. But when comparing it to its historical volatility, Dunham Real Estate is 1.14 times less risky than Real Estate. It trades about 0.06 of its potential returns per unit of risk. Real Estate Fund is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest 2,601 in Real Estate Fund on November 9, 2024 and sell it today you would earn a total of 92.00 from holding Real Estate Fund or generate 3.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dunham Real Estate vs. Real Estate Fund
Performance |
| Timeline |
| Dunham Real Estate |
| Real Estate Fund |
Dunham Real and Real Estate Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dunham Real and Real Estate
The main advantage of trading using opposite Dunham Real and Real Estate positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dunham Real position performs unexpectedly, Real Estate 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 Real Estate will offset losses from the drop in Real Estate's long position.| Dunham Real vs. Gold Portfolio Fidelity | Dunham Real vs. First Eagle Gold | Dunham Real vs. World Precious Minerals | Dunham Real vs. Invesco Gold Special |
| Real Estate vs. Forum Real Estate | Real Estate vs. Tiaa Cref Real Estate | Real Estate vs. Principal Real Estate | Real Estate vs. Short Real Estate |
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 Stocks Directory module to find actively traded stocks across global markets.
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