Correlation Between Dunham Real and Dunham Floating
Can any of the company-specific risk be diversified away by investing in both Dunham Real and Dunham Floating 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 Real and Dunham Floating into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dunham Real Estate and Dunham Floating Rate, you can compare the effects of market volatilities on Dunham Real and Dunham Floating 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 Real with a short position of Dunham Floating. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dunham Real and Dunham Floating.
Diversification Opportunities for Dunham Real and Dunham Floating
0.9 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Dunham and Dunham is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding Dunham Real Estate and Dunham Floating Rate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dunham Floating Rate and Dunham Real 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 Real Estate are associated (or correlated) with Dunham Floating. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dunham Floating Rate has no effect on the direction of Dunham Real i.e., Dunham Real and Dunham Floating go up and down completely randomly.
Pair Corralation between Dunham Real and Dunham Floating
Assuming the 90 days horizon Dunham Real Estate is expected to generate 9.49 times more return on investment than Dunham Floating. However, Dunham Real is 9.49 times more volatile than Dunham Floating Rate. It trades about 0.15 of its potential returns per unit of risk. Dunham Floating Rate is currently generating about 0.63 per unit of risk. If you would invest 1,300 in Dunham Real Estate on April 30, 2025 and sell it today you would earn a total of 118.00 from holding Dunham Real Estate or generate 9.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dunham Real Estate vs. Dunham Floating Rate
Performance |
| Timeline |
| Dunham Real Estate |
Risk-Adjusted Performance
Good
Weak | Strong |
| Dunham Floating Rate |
Dunham Real and Dunham Floating Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dunham Real and Dunham Floating
The main advantage of trading using opposite Dunham Real and Dunham Floating positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dunham Real position performs unexpectedly, Dunham Floating 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 Floating will offset losses from the drop in Dunham Floating's long position.| Dunham Real vs. Lord Abbett Intermediate | Dunham Real vs. Pace Municipal Fixed | Dunham Real vs. The National Tax Free | Dunham Real vs. Redwood Managed Municipal |
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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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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