Correlation Between Dunham Focused and Dunham International
Can any of the company-specific risk be diversified away by investing in both Dunham Focused and Dunham 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 Focused and Dunham International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dunham Focused Large and Dunham International Opportunity, you can compare the effects of market volatilities on Dunham Focused and Dunham 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 Focused with a short position of Dunham International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dunham Focused and Dunham International.
Diversification Opportunities for Dunham Focused and Dunham International
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Dunham and Dunham is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding Dunham Focused Large and Dunham International Opportuni in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dunham International and Dunham Focused 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 Focused Large are associated (or correlated) with Dunham International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dunham International has no effect on the direction of Dunham Focused i.e., Dunham Focused and Dunham International go up and down completely randomly.
Pair Corralation between Dunham Focused and Dunham International
Assuming the 90 days horizon Dunham Focused Large is expected to generate 6.66 times more return on investment than Dunham International. However, Dunham Focused is 6.66 times more volatile than Dunham International Opportunity. It trades about 0.08 of its potential returns per unit of risk. Dunham International Opportunity is currently generating about 0.24 per unit of risk. If you would invest 4,031 in Dunham Focused Large on June 12, 2025 and sell it today you would earn a total of 178.00 from holding Dunham Focused Large or generate 4.42% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dunham Focused Large vs. Dunham International Opportuni
Performance |
| Timeline |
| Dunham Focused Large |
| Dunham International |
Dunham Focused and Dunham International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dunham Focused and Dunham International
The main advantage of trading using opposite Dunham Focused and Dunham International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dunham Focused position performs unexpectedly, Dunham 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 Dunham International will offset losses from the drop in Dunham International's long position.| Dunham Focused vs. Biotechnology Ultrasector Profund | Dunham Focused vs. Fidelity Advisor Technology | Dunham Focused vs. Putnam Global Technology | Dunham Focused vs. Franklin Biotechnology Discovery |
| Dunham International vs. Rbc Emerging Markets | Dunham International vs. Siit Emerging Markets | Dunham International vs. Astor Longshort Fund | Dunham International vs. Franklin Emerging Market |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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