Correlation Between Perkins Mid and Dunham High
Can any of the company-specific risk be diversified away by investing in both Perkins Mid and Dunham High 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 Perkins Mid and Dunham High into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Perkins Mid Cap and Dunham High Yield, you can compare the effects of market volatilities on Perkins Mid and Dunham High 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 Perkins Mid with a short position of Dunham High. Check out your portfolio center. Please also check ongoing floating volatility patterns of Perkins Mid and Dunham High.
Diversification Opportunities for Perkins Mid and Dunham High
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Perkins and Dunham is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Perkins Mid Cap and Dunham High Yield in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dunham High Yield and Perkins Mid 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 Perkins Mid Cap are associated (or correlated) with Dunham High. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dunham High Yield has no effect on the direction of Perkins Mid i.e., Perkins Mid and Dunham High go up and down completely randomly.
Pair Corralation between Perkins Mid and Dunham High
Assuming the 90 days horizon Perkins Mid Cap is expected to generate 6.67 times more return on investment than Dunham High. However, Perkins Mid is 6.67 times more volatile than Dunham High Yield. It trades about 0.31 of its potential returns per unit of risk. Dunham High Yield is currently generating about 0.22 per unit of risk. If you would invest 1,717 in Perkins Mid Cap on September 3, 2024 and sell it today you would earn a total of 111.00 from holding Perkins Mid Cap or generate 6.46% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Perkins Mid Cap vs. Dunham High Yield
Performance |
| Timeline |
| Perkins Mid Cap |
| Dunham High Yield |
Perkins Mid and Dunham High Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Perkins Mid and Dunham High
The main advantage of trading using opposite Perkins Mid and Dunham High positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Perkins Mid position performs unexpectedly, Dunham High 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 High will offset losses from the drop in Dunham High's long position.| Perkins Mid vs. Dunham High Yield | Perkins Mid vs. Prudential High Yield | Perkins Mid vs. Blackrock High Yield | Perkins Mid vs. Pioneer High Yield |
| Dunham High vs. Vanguard High Yield Corporate | Dunham High vs. Vanguard High Yield Porate | Dunham High vs. Blackrock Hi Yld | Dunham High vs. Blackrock High Yield |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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