Correlation Between Dodge Cox and Emerging Europe
Can any of the company-specific risk be diversified away by investing in both Dodge Cox and Emerging Europe 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 Emerging Europe 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 Emerging Europe Fund, you can compare the effects of market volatilities on Dodge Cox and Emerging Europe 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 Emerging Europe. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dodge Cox and Emerging Europe.
Diversification Opportunities for Dodge Cox and Emerging Europe
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Dodge and Emerging is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Dodge Cox Stock and Emerging Europe Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Emerging Europe 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 Emerging Europe. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Emerging Europe has no effect on the direction of Dodge Cox i.e., Dodge Cox and Emerging Europe go up and down completely randomly.
Pair Corralation between Dodge Cox and Emerging Europe
If you would invest 23,313 in Dodge Cox Stock on September 12, 2024 and sell it today you would earn a total of 4,817 from holding Dodge Cox Stock or generate 20.66% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 0.4% |
| Values | Daily Returns |
Dodge Cox Stock vs. Emerging Europe Fund
Performance |
| Timeline |
| Dodge Cox Stock |
| Emerging Europe |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Dodge Cox and Emerging Europe Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dodge Cox and Emerging Europe
The main advantage of trading using opposite Dodge Cox and Emerging Europe positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dodge Cox position performs unexpectedly, Emerging Europe 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 Emerging Europe will offset losses from the drop in Emerging Europe'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 |
| Emerging Europe vs. Franklin High Yield | Emerging Europe vs. Doubleline Yield Opportunities | Emerging Europe vs. Dws Government Money | Emerging Europe vs. Bbh Intermediate Municipal |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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