Correlation Between CBH and Doubleline Income

Can any of the company-specific risk be diversified away by investing in both CBH and Doubleline Income 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 CBH and Doubleline Income into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between CBH and Doubleline Income Solutions, you can compare the effects of market volatilities on CBH and Doubleline Income 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 CBH with a short position of Doubleline Income. Check out your portfolio center. Please also check ongoing floating volatility patterns of CBH and Doubleline Income.

Diversification Opportunities for CBH and Doubleline Income

0.0

Correlation Coefficient

CBH  Doubleline Income

Pay attention - limited upside

The 3 months correlation between CBH and Doubleline is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding CBH and Doubleline Income Solutions in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Doubleline Income and CBH 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 CBH are associated (or correlated) with Doubleline Income. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Doubleline Income has no effect on the direction of CBH i.e., CBH and Doubleline Income go up and down completely randomly.

Pair Corralation between CBH and Doubleline Income

If you would invest  1,251  in Doubleline Income Solutions on September 3, 2024 and sell it today you would earn a total of  29.00  from holding Doubleline Income Solutions or generate 2.32% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	1.56%
Values	Daily Returns

CBH  vs.  Doubleline Income Solutions

CBH

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days CBH has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong fundamental drivers, CBH is not utilizing all of its potentials. The newest stock price confusion, may contribute to short-horizon losses for the traders.

Doubleline Income

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Doubleline Income Solutions are ranked lower than 4 (%) of all funds and portfolios of funds over the last 90 days. Despite quite persistent basic indicators, Doubleline Income is not utilizing all of its potentials. The current stock price mess, may contribute to short-term losses for the institutional investors.

Pair Trading with CBH and Doubleline Income

The main advantage of trading using opposite CBH and Doubleline Income positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CBH position performs unexpectedly, Doubleline Income 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 Doubleline Income will offset losses from the drop in Doubleline Income's long position.

The idea behind CBH and Doubleline Income Solutions pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.