Correlation Between Dodge Cox and Guidemark Large
Can any of the company-specific risk be diversified away by investing in both Dodge Cox and Guidemark 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 Cox and Guidemark Large 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 Guidemark Large Cap, you can compare the effects of market volatilities on Dodge Cox and Guidemark 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 Cox with a short position of Guidemark Large. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dodge Cox and Guidemark Large.
Diversification Opportunities for Dodge Cox and Guidemark Large
0.27 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Dodge and Guidemark is 0.27. Overlapping area represents the amount of risk that can be diversified away by holding Dodge Cox Stock and Guidemark Large Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guidemark Large Cap 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 Guidemark Large. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guidemark Large Cap has no effect on the direction of Dodge Cox i.e., Dodge Cox and Guidemark Large go up and down completely randomly.
Pair Corralation between Dodge Cox and Guidemark Large
Assuming the 90 days horizon Dodge Cox Stock is expected to generate 0.84 times more return on investment than Guidemark Large. However, Dodge Cox Stock is 1.2 times less risky than Guidemark Large. It trades about 0.13 of its potential returns per unit of risk. Guidemark Large Cap is currently generating about 0.05 per unit of risk. If you would invest 20,632 in Dodge Cox Stock on August 27, 2024 and sell it today you would earn a total of 7,895 from holding Dodge Cox Stock or generate 38.27% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dodge Cox Stock vs. Guidemark Large Cap
Performance |
| Timeline |
| Dodge Cox Stock |
| Guidemark Large Cap |
Dodge Cox and Guidemark Large Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dodge Cox and Guidemark Large
The main advantage of trading using opposite Dodge Cox and Guidemark Large positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dodge Cox position performs unexpectedly, Guidemark 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 Guidemark Large will offset losses from the drop in Guidemark Large's long position.| Dodge Cox vs. Dodge International Stock | Dodge Cox vs. Dodge Balanced Fund | Dodge Cox vs. Dodge Income Fund | Dodge Cox vs. Total Return Fund |
| Guidemark Large vs. Short Duration Inflation | Guidemark Large vs. Deutsche Global Inflation | Guidemark Large vs. Ab Bond Inflation | Guidemark Large vs. Aqr Managed Futures |
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 CEOs Directory module to screen CEOs from public companies around the world.
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