Correlation Between Oakmark Equity and Dodge Balanced
Can any of the company-specific risk be diversified away by investing in both Oakmark Equity and Dodge Balanced 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 Oakmark Equity and Dodge Balanced into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Oakmark Equity And and Dodge Balanced Fund, you can compare the effects of market volatilities on Oakmark Equity and Dodge Balanced 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 Oakmark Equity with a short position of Dodge Balanced. Check out your portfolio center. Please also check ongoing floating volatility patterns of Oakmark Equity and Dodge Balanced.
Diversification Opportunities for Oakmark Equity and Dodge Balanced
0.63 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Oakmark and Dodge is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding Oakmark Equity And and Dodge Balanced Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dodge Balanced and Oakmark Equity 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 Oakmark Equity And are associated (or correlated) with Dodge Balanced. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dodge Balanced has no effect on the direction of Oakmark Equity i.e., Oakmark Equity and Dodge Balanced go up and down completely randomly.
Pair Corralation between Oakmark Equity and Dodge Balanced
Assuming the 90 days horizon Oakmark Equity is expected to generate 1.35 times less return on investment than Dodge Balanced. In addition to that, Oakmark Equity is 1.01 times more volatile than Dodge Balanced Fund. It trades about 0.15 of its total potential returns per unit of risk. Dodge Balanced Fund is currently generating about 0.2 per unit of volatility. If you would invest 10,163 in Dodge Balanced Fund on October 21, 2024 and sell it today you would earn a total of 176.00 from holding Dodge Balanced Fund or generate 1.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Oakmark Equity And vs. Dodge Balanced Fund
Performance |
| Timeline |
| Oakmark Equity And |
| Dodge Balanced |
Oakmark Equity and Dodge Balanced Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Oakmark Equity and Dodge Balanced
The main advantage of trading using opposite Oakmark Equity and Dodge Balanced positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Oakmark Equity position performs unexpectedly, Dodge Balanced 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 Balanced will offset losses from the drop in Dodge Balanced's long position.| Oakmark Equity vs. Oakmark Global Fund | Oakmark Equity vs. Oakmark International Fund | Oakmark Equity vs. Oakmark Select Fund | Oakmark Equity vs. T Rowe Price |
| Dodge Balanced vs. Dodge Stock Fund | Dodge Balanced vs. Dodge International Stock | Dodge Balanced vs. Dodge Income Fund | Dodge Balanced vs. Oakmark Equity And |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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