Correlation Between Dodge Cox and Avantis Short
Can any of the company-specific risk be diversified away by investing in both Dodge Cox and Avantis Short 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 Avantis Short into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dodge Cox Stock and Avantis Short Term Fixed, you can compare the effects of market volatilities on Dodge Cox and Avantis Short 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 Avantis Short. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dodge Cox and Avantis Short.
Diversification Opportunities for Dodge Cox and Avantis Short
-0.65 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Dodge and Avantis is -0.65. Overlapping area represents the amount of risk that can be diversified away by holding Dodge Cox Stock and Avantis Short Term Fixed in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Avantis Short Term 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 Cox Stock are associated (or correlated) with Avantis Short. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Avantis Short Term has no effect on the direction of Dodge Cox i.e., Dodge Cox and Avantis Short go up and down completely randomly.
Pair Corralation between Dodge Cox and Avantis Short
Assuming the 90 days horizon Dodge Cox Stock is expected to under-perform the Avantis Short. In addition to that, Dodge Cox is 4.27 times more volatile than Avantis Short Term Fixed. It trades about -0.21 of its total potential returns per unit of risk. Avantis Short Term Fixed is currently generating about 0.18 per unit of volatility. If you would invest 952.00 in Avantis Short Term Fixed on September 12, 2024 and sell it today you would earn a total of 4.00 from holding Avantis Short Term Fixed or generate 0.42% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dodge Cox Stock vs. Avantis Short Term Fixed
Performance |
| Timeline |
| Dodge Cox Stock |
| Avantis Short Term |
Dodge Cox and Avantis Short Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dodge Cox and Avantis Short
The main advantage of trading using opposite Dodge Cox and Avantis Short positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dodge Cox position performs unexpectedly, Avantis Short 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 Avantis Short will offset losses from the drop in Avantis Short's long position.| Dodge Cox vs. Needham Aggressive Growth | Dodge Cox vs. Alliancebernstein Global High | Dodge Cox vs. Ppm High Yield | Dodge Cox vs. Siit High Yield |
| Avantis Short vs. Aqr Large Cap | Avantis Short vs. Upright Assets Allocation | Avantis Short vs. Dodge Cox Stock | Avantis Short vs. Pace Large Growth |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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