Correlation Between Dodge Income and Oppenheimer International
Can any of the company-specific risk be diversified away by investing in both Dodge Income and Oppenheimer International 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 Income and Oppenheimer International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dodge Income Fund and Oppenheimer International Bond, you can compare the effects of market volatilities on Dodge Income and Oppenheimer International 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 Income with a short position of Oppenheimer International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dodge Income and Oppenheimer International.
Diversification Opportunities for Dodge Income and Oppenheimer International
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Dodge and Oppenheimer is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Dodge Income Fund and Oppenheimer International Bond in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Oppenheimer International and Dodge Income 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 Income Fund are associated (or correlated) with Oppenheimer International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Oppenheimer International has no effect on the direction of Dodge Income i.e., Dodge Income and Oppenheimer International go up and down completely randomly.
Pair Corralation between Dodge Income and Oppenheimer International
Assuming the 90 days horizon Dodge Income Fund is expected to generate 0.99 times more return on investment than Oppenheimer International. However, Dodge Income Fund is 1.01 times less risky than Oppenheimer International. It trades about 0.15 of its potential returns per unit of risk. Oppenheimer International Bond is currently generating about 0.15 per unit of risk. If you would invest 1,261 in Dodge Income Fund on September 4, 2024 and sell it today you would earn a total of 15.00 from holding Dodge Income Fund or generate 1.19% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dodge Income Fund vs. Oppenheimer International Bond
Performance |
| Timeline |
| Dodge Income |
| Oppenheimer International |
Dodge Income and Oppenheimer International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dodge Income and Oppenheimer International
The main advantage of trading using opposite Dodge Income and Oppenheimer International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dodge Income position performs unexpectedly, Oppenheimer International 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 Oppenheimer International will offset losses from the drop in Oppenheimer International's long position.| Dodge Income vs. Dodge International Stock | Dodge Income vs. Dodge Balanced Fund | Dodge Income vs. Dodge Stock Fund | Dodge Income vs. Harbor Bond Fund |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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