Correlation Between Dunham Large and Ab International
Can any of the company-specific risk be diversified away by investing in both Dunham Large and Ab International 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 Dunham Large and Ab International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dunham Large Cap and Ab International Growth, you can compare the effects of market volatilities on Dunham Large and Ab International 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 Dunham Large with a short position of Ab International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dunham Large and Ab International.
Diversification Opportunities for Dunham Large and Ab International
-0.64 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Dunham and AWPIX is -0.64. Overlapping area represents the amount of risk that can be diversified away by holding Dunham Large Cap and Ab International Growth in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ab International Growth and Dunham Large 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 Dunham Large Cap are associated (or correlated) with Ab International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ab International Growth has no effect on the direction of Dunham Large i.e., Dunham Large and Ab International go up and down completely randomly.
Pair Corralation between Dunham Large and Ab International
Assuming the 90 days horizon Dunham Large Cap is expected to under-perform the Ab International. But the mutual fund apears to be less risky and, when comparing its historical volatility, Dunham Large Cap is 1.28 times less risky than Ab International. The mutual fund trades about -0.19 of its potential returns per unit of risk. The Ab International Growth is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest 1,992 in Ab International Growth on September 18, 2024 and sell it today you would earn a total of 33.00 from holding Ab International Growth or generate 1.66% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Dunham Large Cap vs. Ab International Growth
Performance |
Timeline |
Dunham Large Cap |
Ab International Growth |
Dunham Large and Ab International Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Dunham Large and Ab International
The main advantage of trading using opposite Dunham Large and Ab International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dunham Large position performs unexpectedly, Ab International 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 Ab International will offset losses from the drop in Ab International's long position.Dunham Large vs. Dunham Dynamic Macro | Dunham Large vs. Dunham Appreciation Income | Dunham Large vs. Dunham Porategovernment Bond | Dunham Large vs. Dunham Small Cap |
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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 Stocks Directory module to find actively traded stocks across global markets.
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