Correlation Between Dunham Dynamic and Cutler Equity
Can any of the company-specific risk be diversified away by investing in both Dunham Dynamic and Cutler Equity 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 Dynamic and Cutler Equity into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dunham Dynamic Macro and Cutler Equity, you can compare the effects of market volatilities on Dunham Dynamic and Cutler Equity 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 Dynamic with a short position of Cutler Equity. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dunham Dynamic and Cutler Equity.
Diversification Opportunities for Dunham Dynamic and Cutler Equity
0.75 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Dunham and Cutler is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding Dunham Dynamic Macro and Cutler Equity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cutler Equity and Dunham Dynamic 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 Dynamic Macro are associated (or correlated) with Cutler Equity. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cutler Equity has no effect on the direction of Dunham Dynamic i.e., Dunham Dynamic and Cutler Equity go up and down completely randomly.
Pair Corralation between Dunham Dynamic and Cutler Equity
Assuming the 90 days horizon Dunham Dynamic is expected to generate 1.64 times less return on investment than Cutler Equity. But when comparing it to its historical volatility, Dunham Dynamic Macro is 1.74 times less risky than Cutler Equity. It trades about 0.09 of its potential returns per unit of risk. Cutler Equity is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 2,777 in Cutler Equity on September 16, 2024 and sell it today you would earn a total of 88.00 from holding Cutler Equity or generate 3.17% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
Dunham Dynamic Macro vs. Cutler Equity
Performance |
Timeline |
Dunham Dynamic Macro |
Cutler Equity |
Dunham Dynamic and Cutler Equity Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Dunham Dynamic and Cutler Equity
The main advantage of trading using opposite Dunham Dynamic and Cutler Equity positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dunham Dynamic position performs unexpectedly, Cutler Equity 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 Cutler Equity will offset losses from the drop in Cutler Equity's long position.Dunham Dynamic vs. Dunham Appreciation Income | Dunham Dynamic vs. Dunham Porategovernment Bond | Dunham Dynamic vs. Dunham Small Cap | Dunham Dynamic vs. Dunham Emerging Markets |
Cutler Equity vs. Extended Market Index | Cutler Equity vs. Dunham Dynamic Macro | Cutler Equity vs. Invesco Technology Fund | Cutler Equity vs. Jp Morgan Smartretirement |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
Other Complementary Tools
Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA | |
Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites |