Correlation Between Dodge Cox and Dodge Cox
Can any of the company-specific risk be diversified away by investing in both Dodge Cox and Dodge Cox 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 Dodge Cox into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dodge Cox Income and Dodge Cox Balanced, you can compare the effects of market volatilities on Dodge Cox and Dodge Cox 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 Dodge Cox. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dodge Cox and Dodge Cox.
Diversification Opportunities for Dodge Cox and Dodge Cox
Excellent diversification
The 3 months correlation between Dodge and Dodge is -0.53. Overlapping area represents the amount of risk that can be diversified away by holding Dodge Cox Income and Dodge Cox Balanced in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dodge Cox Balanced 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 Income are associated (or correlated) with Dodge Cox. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dodge Cox Balanced has no effect on the direction of Dodge Cox i.e., Dodge Cox and Dodge Cox go up and down completely randomly.
Pair Corralation between Dodge Cox and Dodge Cox
Assuming the 90 days horizon Dodge Cox is expected to generate 2.67 times less return on investment than Dodge Cox. But when comparing it to its historical volatility, Dodge Cox Income is 1.17 times less risky than Dodge Cox. It trades about 0.08 of its potential returns per unit of risk. Dodge Cox Balanced is currently generating about 0.19 of returns per unit of risk over similar time horizon. If you would invest 10,885 in Dodge Cox Balanced on August 30, 2024 and sell it today you would earn a total of 211.00 from holding Dodge Cox Balanced or generate 1.94% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dodge Cox Income vs. Dodge Cox Balanced
Performance |
| Timeline |
| Dodge Cox Income |
| Dodge Cox Balanced |
Dodge Cox and Dodge Cox Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dodge Cox and Dodge Cox
The main advantage of trading using opposite Dodge Cox and Dodge Cox positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dodge Cox position performs unexpectedly, Dodge Cox 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 Dodge Cox will offset losses from the drop in Dodge Cox's long position.| Dodge Cox vs. Vanguard Equity Income | Dodge Cox vs. Rbc Global Equity | Dodge Cox vs. Touchstone International Equity | Dodge Cox vs. Dodge International Stock |
| Dodge Cox vs. Huber Capital Diversified | Dodge Cox vs. Evaluator Conservative Rms | Dodge Cox vs. Conservative Balanced Allocation | Dodge Cox vs. Calvert Conservative Allocation |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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