Correlation Between Dodge International and Dunham Large
Can any of the company-specific risk be diversified away by investing in both Dodge International and Dunham Large 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 International and Dunham Large 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 Dunham Large Cap, you can compare the effects of market volatilities on Dodge International and Dunham Large 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 International with a short position of Dunham Large. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dodge International and Dunham Large.
Diversification Opportunities for Dodge International and Dunham Large
-0.28 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Dodge and Dunham is -0.28. Overlapping area represents the amount of risk that can be diversified away by holding Dodge International Stock and Dunham Large Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dunham Large Cap and Dodge 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 Dodge International Stock are associated (or correlated) with Dunham Large. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dunham Large Cap has no effect on the direction of Dodge International i.e., Dodge International and Dunham Large go up and down completely randomly.
Pair Corralation between Dodge International and Dunham Large
Assuming the 90 days horizon Dodge International is expected to generate 1.32 times less return on investment than Dunham Large. In addition to that, Dodge International is 1.14 times more volatile than Dunham Large Cap. It trades about 0.06 of its total potential returns per unit of risk. Dunham Large Cap is currently generating about 0.09 per unit of volatility. If you would invest 1,593 in Dunham Large Cap on September 12, 2024 and sell it today you would earn a total of 333.00 from holding Dunham Large Cap or generate 20.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dodge International Stock vs. Dunham Large Cap
Performance |
| Timeline |
| Dodge International Stock |
| Dunham Large Cap |
Dodge International and Dunham Large Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dodge International and Dunham Large
The main advantage of trading using opposite Dodge International and Dunham Large positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dodge International position performs unexpectedly, Dunham Large 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 Large will offset losses from the drop in Dunham Large's long position.| Dodge International vs. Dodge Stock Fund | Dodge International vs. Dodge Income Fund | Dodge International vs. Dodge Balanced Fund | Dodge International vs. The Fairholme Fund |
| Dunham Large vs. Artisan Select Equity | Dunham Large vs. Dodge International Stock | Dunham Large vs. Sarofim Equity | Dunham Large vs. Gmo Global Equity |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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