Correlation Between Guidemark Large and Dodge Cox
Can any of the company-specific risk be diversified away by investing in both Guidemark Large 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 Guidemark Large and Dodge Cox into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Guidemark Large Cap and Dodge Cox Stock, you can compare the effects of market volatilities on Guidemark Large 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 Guidemark Large with a short position of Dodge Cox. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guidemark Large and Dodge Cox.
Diversification Opportunities for Guidemark Large and Dodge Cox
0.27 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Guidemark and Dodge is 0.27. Overlapping area represents the amount of risk that can be diversified away by holding Guidemark Large Cap and Dodge Cox Stock in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dodge Cox Stock and Guidemark Large 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 Guidemark Large Cap 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 Stock has no effect on the direction of Guidemark Large i.e., Guidemark Large and Dodge Cox go up and down completely randomly.
Pair Corralation between Guidemark Large and Dodge Cox
Assuming the 90 days horizon Guidemark Large Cap is expected to under-perform the Dodge Cox. But the mutual fund apears to be less risky and, when comparing its historical volatility, Guidemark Large Cap is 1.05 times less risky than Dodge Cox. The mutual fund trades about -0.19 of its potential returns per unit of risk. The Dodge Cox Stock is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest 27,710 in Dodge Cox Stock on August 27, 2024 and sell it today you would earn a total of 817.00 from holding Dodge Cox Stock or generate 2.95% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Guidemark Large Cap vs. Dodge Cox Stock
Performance |
| Timeline |
| Guidemark Large Cap |
| Dodge Cox Stock |
Guidemark Large and Dodge Cox Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guidemark Large and Dodge Cox
The main advantage of trading using opposite Guidemark Large and Dodge Cox positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guidemark Large 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.| Guidemark Large vs. Short Duration Inflation | Guidemark Large vs. Deutsche Global Inflation | Guidemark Large vs. Ab Bond Inflation | Guidemark Large vs. Aqr Managed Futures |
| Dodge Cox vs. Dodge International Stock | Dodge Cox vs. Dodge Balanced Fund | Dodge Cox vs. Dodge Income Fund | Dodge Cox vs. Total Return Fund |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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