Correlation Between American Funds and Doubleline Total
Can any of the company-specific risk be diversified away by investing in both American Funds and Doubleline Total 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 American Funds and Doubleline Total into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between American Funds Inflation and Doubleline Total Return, you can compare the effects of market volatilities on American Funds and Doubleline Total 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 American Funds with a short position of Doubleline Total. Check out your portfolio center. Please also check ongoing floating volatility patterns of American Funds and Doubleline Total.
Diversification Opportunities for American Funds and Doubleline Total
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between American and Doubleline is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding American Funds Inflation and Doubleline Total Return in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Doubleline Total Return and American Funds 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 American Funds Inflation are associated (or correlated) with Doubleline Total. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Doubleline Total Return has no effect on the direction of American Funds i.e., American Funds and Doubleline Total go up and down completely randomly.
Pair Corralation between American Funds and Doubleline Total
Assuming the 90 days horizon American Funds is expected to generate 1.62 times less return on investment than Doubleline Total. But when comparing it to its historical volatility, American Funds Inflation is 1.06 times less risky than Doubleline Total. It trades about 0.03 of its potential returns per unit of risk. Doubleline Total Return is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 815.00 in Doubleline Total Return on September 12, 2024 and sell it today you would earn a total of 69.00 from holding Doubleline Total Return or generate 8.47% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
American Funds Inflation vs. Doubleline Total Return
Performance |
| Timeline |
| American Funds Inflation |
| Doubleline Total Return |
American Funds and Doubleline Total Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with American Funds and Doubleline Total
The main advantage of trading using opposite American Funds and Doubleline Total positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if American Funds position performs unexpectedly, Doubleline Total 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 Doubleline Total will offset losses from the drop in Doubleline Total's long position.| American Funds vs. Vanguard Inflation Protected Securities | American Funds vs. Vanguard Inflation Protected Securities | American Funds vs. American Funds Inflation |
| Doubleline Total vs. Prudential Government Money | Doubleline Total vs. Aig Government Money | Doubleline Total vs. Ab Government Exchange | Doubleline Total vs. Schwab Treasury Money |
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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
Other Complementary Tools
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
| Fundamental Analysis View fundamental data based on most recent published financial statements | |
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities |