Correlation Between Lsv Global and Dodge Global
Can any of the company-specific risk be diversified away by investing in both Lsv Global and Dodge Global 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 Lsv Global and Dodge Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lsv Global Managed and Dodge Global Stock, you can compare the effects of market volatilities on Lsv Global and Dodge Global 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 Lsv Global with a short position of Dodge Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lsv Global and Dodge Global.
Diversification Opportunities for Lsv Global and Dodge Global
0.46 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Lsv and Dodge is 0.46. Overlapping area represents the amount of risk that can be diversified away by holding Lsv Global Managed and Dodge Global Stock in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dodge Global Stock and Lsv Global 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 Lsv Global Managed are associated (or correlated) with Dodge Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dodge Global Stock has no effect on the direction of Lsv Global i.e., Lsv Global and Dodge Global go up and down completely randomly.
Pair Corralation between Lsv Global and Dodge Global
Assuming the 90 days horizon Lsv Global Managed is expected to generate 0.87 times more return on investment than Dodge Global. However, Lsv Global Managed is 1.14 times less risky than Dodge Global. It trades about -0.07 of its potential returns per unit of risk. Dodge Global Stock is currently generating about -0.18 per unit of risk. If you would invest 1,214 in Lsv Global Managed on September 12, 2024 and sell it today you would lose (8.00) from holding Lsv Global Managed or give up 0.66% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lsv Global Managed vs. Dodge Global Stock
Performance |
| Timeline |
| Lsv Global Managed |
| Dodge Global Stock |
Lsv Global and Dodge Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lsv Global and Dodge Global
The main advantage of trading using opposite Lsv Global and Dodge Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lsv Global position performs unexpectedly, Dodge Global 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 Global will offset losses from the drop in Dodge Global's long position.| Lsv Global vs. Dodge Global Stock | Lsv Global vs. Franklin Mutual Global | Lsv Global vs. T Rowe Price | Lsv Global vs. HUMANA INC |
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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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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