Correlation Between Dodge Cox and Ab Select
Can any of the company-specific risk be diversified away by investing in both Dodge Cox and Ab Select 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 Dodge Cox and Ab Select into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dodge International Stock and Ab Select Equity, you can compare the effects of market volatilities on Dodge Cox and Ab Select 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 Dodge Cox with a short position of Ab Select. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dodge Cox and Ab Select.
Diversification Opportunities for Dodge Cox and Ab Select
Average diversification
The 3 months correlation between Dodge and AUUIX is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding Dodge International Stock and Ab Select Equity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ab Select Equity and Dodge Cox 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 Dodge International Stock are associated (or correlated) with Ab Select. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ab Select Equity has no effect on the direction of Dodge Cox i.e., Dodge Cox and Ab Select go up and down completely randomly.
Pair Corralation between Dodge Cox and Ab Select
Assuming the 90 days horizon Dodge International Stock is expected to under-perform the Ab Select. But the mutual fund apears to be less risky and, when comparing its historical volatility, Dodge International Stock is 1.11 times less risky than Ab Select. The mutual fund trades about -0.22 of its potential returns per unit of risk. The Ab Select Equity is currently generating about 0.17 of returns per unit of risk over similar time horizon. If you would invest 2,319 in Ab Select Equity on August 28, 2024 and sell it today you would earn a total of 69.00 from holding Ab Select Equity or generate 2.98% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dodge International Stock vs. Ab Select Equity
Performance |
| Timeline |
| Dodge International Stock |
| Ab Select Equity |
Dodge Cox and Ab Select Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dodge Cox and Ab Select
The main advantage of trading using opposite Dodge Cox and Ab Select positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dodge Cox position performs unexpectedly, Ab Select 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 Ab Select will offset losses from the drop in Ab Select's long position.| Dodge Cox vs. Dodge Stock Fund | Dodge Cox vs. Dodge Income Fund | Dodge Cox vs. Dodge Balanced Fund | Dodge Cox vs. The Fairholme Fund |
| Ab Select vs. Queens Road Small | Ab Select vs. Applied Finance Explorer | Ab Select vs. Small Cap Value Series | Ab Select vs. Victory Rs Partners |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
Other Complementary Tools
| Commodity Directory Find actively traded commodities issued by global exchanges | |
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities |