Correlation Between Dodge Cox and Great-west Loomis
Can any of the company-specific risk be diversified away by investing in both Dodge Cox and Great-west Loomis 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 Great-west Loomis 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 Great West Loomis Sayles, you can compare the effects of market volatilities on Dodge Cox and Great-west Loomis 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 Great-west Loomis. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dodge Cox and Great-west Loomis.
Diversification Opportunities for Dodge Cox and Great-west Loomis
0.8 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Dodge and Great-west is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding Dodge Cox Stock and Great West Loomis Sayles in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Great West Loomis 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 Great-west Loomis. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Great West Loomis has no effect on the direction of Dodge Cox i.e., Dodge Cox and Great-west Loomis go up and down completely randomly.
Pair Corralation between Dodge Cox and Great-west Loomis
Assuming the 90 days horizon Dodge Cox Stock is expected to generate 0.77 times more return on investment than Great-west Loomis. However, Dodge Cox Stock is 1.29 times less risky than Great-west Loomis. It trades about 0.34 of its potential returns per unit of risk. Great West Loomis Sayles is currently generating about 0.15 per unit of risk. If you would invest 25,438 in Dodge Cox Stock on October 20, 2024 and sell it today you would earn a total of 1,234 from holding Dodge Cox Stock or generate 4.85% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dodge Cox Stock vs. Great West Loomis Sayles
Performance |
| Timeline |
| Dodge Cox Stock |
| Great West Loomis |
Dodge Cox and Great-west Loomis Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dodge Cox and Great-west Loomis
The main advantage of trading using opposite Dodge Cox and Great-west Loomis positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dodge Cox position performs unexpectedly, Great-west Loomis 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 Great-west Loomis will offset losses from the drop in Great-west Loomis' long position.| Dodge Cox vs. Tax Managed Large Cap | Dodge Cox vs. L Abbett Fundamental | Dodge Cox vs. Rbb Fund | Dodge Cox vs. Ab Small Cap |
| Great-west Loomis vs. Rationalpier 88 Convertible | Great-west Loomis vs. Virtus Convertible | Great-west Loomis vs. Advent Claymore Convertible | Great-west Loomis vs. Invesco Vertible Securities |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
Other Complementary Tools
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data |