Correlation Between Meridian Growth and Dunham Large
Can any of the company-specific risk be diversified away by investing in both Meridian Growth and Dunham Large 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 Meridian Growth and Dunham Large into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Meridian Growth Fund and Dunham Large Cap, you can compare the effects of market volatilities on Meridian Growth and Dunham Large 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 Meridian Growth with a short position of Dunham Large. Check out your portfolio center. Please also check ongoing floating volatility patterns of Meridian Growth and Dunham Large.
Diversification Opportunities for Meridian Growth and Dunham Large
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Meridian and DUNHAM is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Meridian Growth Fund and Dunham Large Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dunham Large Cap and Meridian Growth 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 Meridian Growth Fund are associated (or correlated) with Dunham Large. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dunham Large Cap has no effect on the direction of Meridian Growth i.e., Meridian Growth and Dunham Large go up and down completely randomly.
Pair Corralation between Meridian Growth and Dunham Large
Assuming the 90 days horizon Meridian Growth is expected to generate 1.07 times less return on investment than Dunham Large. In addition to that, Meridian Growth is 1.59 times more volatile than Dunham Large Cap. It trades about 0.09 of its total potential returns per unit of risk. Dunham Large Cap is currently generating about 0.16 per unit of volatility. If you would invest 1,879 in Dunham Large Cap on September 1, 2024 and sell it today you would earn a total of 257.00 from holding Dunham Large Cap or generate 13.68% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Strong |
Accuracy | 100.0% |
Values | Daily Returns |
Meridian Growth Fund vs. Dunham Large Cap
Performance |
Timeline |
Meridian Growth |
Dunham Large Cap |
Meridian Growth and Dunham Large Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Meridian Growth and Dunham Large
The main advantage of trading using opposite Meridian Growth and Dunham Large positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Meridian Growth position performs unexpectedly, Dunham Large 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 Large will offset losses from the drop in Dunham Large's long position.Meridian Growth vs. Quantitative Longshort Equity | Meridian Growth vs. Aqr Long Short Equity | Meridian Growth vs. Goldman Sachs Short Term | Meridian Growth vs. Jhancock Short Duration |
Dunham Large vs. Dunham Appreciation Income | Dunham Large vs. Dunham Dynamic Macro | Dunham Large vs. Dunham Small Cap | Dunham Large vs. Dunham Emerging Markets |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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