Correlation Between Dodge Cox and Frost Growth
Can any of the company-specific risk be diversified away by investing in both Dodge Cox and Frost Growth 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 Frost Growth 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 Frost Growth Equity, you can compare the effects of market volatilities on Dodge Cox and Frost Growth 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 Frost Growth. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dodge Cox and Frost Growth.
Diversification Opportunities for Dodge Cox and Frost Growth
-0.11 | Correlation Coefficient |
Good diversification
The 3 months correlation between Dodge and Frost is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding Dodge Cox Stock and Frost Growth Equity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Frost Growth 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 Cox Stock are associated (or correlated) with Frost Growth. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Frost Growth Equity has no effect on the direction of Dodge Cox i.e., Dodge Cox and Frost Growth go up and down completely randomly.
Pair Corralation between Dodge Cox and Frost Growth
Assuming the 90 days horizon Dodge Cox Stock is expected to generate 0.22 times more return on investment than Frost Growth. However, Dodge Cox Stock is 4.61 times less risky than Frost Growth. It trades about 0.29 of its potential returns per unit of risk. Frost Growth Equity is currently generating about -0.17 per unit of risk. If you would invest 27,403 in Dodge Cox Stock on September 3, 2024 and sell it today you would earn a total of 1,402 from holding Dodge Cox Stock or generate 5.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dodge Cox Stock vs. Frost Growth Equity
Performance |
| Timeline |
| Dodge Cox Stock |
| Frost Growth Equity |
Dodge Cox and Frost Growth Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dodge Cox and Frost Growth
The main advantage of trading using opposite Dodge Cox and Frost Growth positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dodge Cox position performs unexpectedly, Frost Growth 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 Frost Growth will offset losses from the drop in Frost Growth's long position.| Dodge Cox vs. Tekla Healthcare Opportunities | Dodge Cox vs. Health Biotchnology Portfolio | Dodge Cox vs. Eventide Healthcare Life | Dodge Cox vs. Lord Abbett Health |
| Frost Growth vs. Avantis Large Cap | Frost Growth vs. Dunham Large Cap | Frost Growth vs. Fidelity Series 1000 | Frost Growth vs. Dodge Cox Stock |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
Other Complementary Tools
| Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
| CEOs Directory Screen CEOs from public companies around the world | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities |