Correlation Between Iaadx and Dunham Real
Can any of the company-specific risk be diversified away by investing in both Iaadx 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 Iaadx and Dunham Real into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Iaadx and Dunham Real Estate, you can compare the effects of market volatilities on Iaadx 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 Iaadx with a short position of Dunham Real. Check out your portfolio center. Please also check ongoing floating volatility patterns of Iaadx and Dunham Real.
Diversification Opportunities for Iaadx and Dunham Real
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Iaadx and Dunham is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Iaadx 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 Iaadx 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 Iaadx 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 Iaadx i.e., Iaadx and Dunham Real go up and down completely randomly.
Pair Corralation between Iaadx and Dunham Real
Assuming the 90 days horizon Iaadx is expected to generate 445.0 times less return on investment than Dunham Real. But when comparing it to its historical volatility, Iaadx is 3.93 times less risky than Dunham Real. It trades about 0.0 of its potential returns per unit of risk. Dunham Real Estate is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest 1,251 in Dunham Real Estate on October 21, 2024 and sell it today you would earn a total of 31.00 from holding Dunham Real Estate or generate 2.48% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Iaadx vs. Dunham Real Estate
Performance |
| Timeline |
| Iaadx |
| Dunham Real Estate |
Iaadx and Dunham Real Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Iaadx and Dunham Real
The main advantage of trading using opposite Iaadx and Dunham Real positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Iaadx 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.| Iaadx vs. Putnman Retirement Ready | Iaadx vs. Sierra E Retirement | Iaadx vs. Moderately Aggressive Balanced | Iaadx vs. Voya Target Retirement |
| Dunham Real vs. Realty Income | Dunham Real vs. Dynex Capital | Dunham Real vs. First Industrial Realty | Dunham Real vs. Healthcare Realty Trust |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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