Correlation Between Gabelli Equity and Dunham Real
Can any of the company-specific risk be diversified away by investing in both Gabelli Equity and Dunham Real 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 Gabelli Equity and Dunham Real into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Gabelli Equity Income and Dunham Real Estate, you can compare the effects of market volatilities on Gabelli Equity and Dunham Real 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 Gabelli Equity with a short position of Dunham Real. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gabelli Equity and Dunham Real.
Diversification Opportunities for Gabelli Equity and Dunham Real
0.45 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Gabelli and Dunham is 0.45. Overlapping area represents the amount of risk that can be diversified away by holding Gabelli Equity Income and Dunham Real Estate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dunham Real Estate and Gabelli Equity 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 Gabelli Equity Income are associated (or correlated) with Dunham Real. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dunham Real Estate has no effect on the direction of Gabelli Equity i.e., Gabelli Equity and Dunham Real go up and down completely randomly.
Pair Corralation between Gabelli Equity and Dunham Real
Assuming the 90 days horizon Gabelli Equity is expected to generate 1.74 times less return on investment than Dunham Real. But when comparing it to its historical volatility, Gabelli Equity Income is 1.17 times less risky than Dunham Real. It trades about 0.08 of its potential returns per unit of risk. Dunham Real Estate is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 1,338 in Dunham Real Estate on August 29, 2024 and sell it today you would earn a total of 195.00 from holding Dunham Real Estate or generate 14.57% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Gabelli Equity Income vs. Dunham Real Estate
Performance |
| Timeline |
| Gabelli Equity Income |
| Dunham Real Estate |
Gabelli Equity and Dunham Real Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gabelli Equity and Dunham Real
The main advantage of trading using opposite Gabelli Equity and Dunham Real positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gabelli Equity position performs unexpectedly, Dunham Real 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 Dunham Real will offset losses from the drop in Dunham Real's long position.| Gabelli Equity vs. Vanguard Total Stock | Gabelli Equity vs. Vanguard 500 Index | Gabelli Equity vs. Vanguard Total Stock | Gabelli Equity vs. Vanguard Total Stock |
| Dunham Real vs. Franklin Natural Resources | Dunham Real vs. HUMANA INC | Dunham Real vs. Aquagold International | Dunham Real vs. Barloworld Ltd ADR |
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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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