Correlation Between Dana Large and Profunds-large Cap
Can any of the company-specific risk be diversified away by investing in both Dana Large and Profunds-large Cap 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 Dana Large and Profunds-large Cap into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dana Large Cap and Profunds Large Cap Growth, you can compare the effects of market volatilities on Dana Large and Profunds-large Cap 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 Dana Large with a short position of Profunds-large Cap. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dana Large and Profunds-large Cap.
Diversification Opportunities for Dana Large and Profunds-large Cap
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Dana and Profunds-large is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Dana Large Cap and Profunds Large Cap Growth in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Profunds Large Cap and Dana 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 Dana Large Cap are associated (or correlated) with Profunds-large Cap. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Profunds Large Cap has no effect on the direction of Dana Large i.e., Dana Large and Profunds-large Cap go up and down completely randomly.
Pair Corralation between Dana Large and Profunds-large Cap
Assuming the 90 days horizon Dana Large is expected to generate 1.12 times less return on investment than Profunds-large Cap. But when comparing it to its historical volatility, Dana Large Cap is 1.17 times less risky than Profunds-large Cap. It trades about 0.2 of its potential returns per unit of risk. Profunds Large Cap Growth is currently generating about 0.19 of returns per unit of risk over similar time horizon. If you would invest 3,617 in Profunds Large Cap Growth on June 9, 2025 and sell it today you would earn a total of 339.00 from holding Profunds Large Cap Growth or generate 9.37% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dana Large Cap vs. Profunds Large Cap Growth
Performance |
| Timeline |
| Dana Large Cap |
| Profunds Large Cap |
Dana Large and Profunds-large Cap Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dana Large and Profunds-large Cap
The main advantage of trading using opposite Dana Large and Profunds-large Cap positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dana Large position performs unexpectedly, Profunds-large Cap 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 Profunds-large Cap will offset losses from the drop in Profunds-large Cap's long position.| Dana Large vs. Dana Epiphany Esg | Dana Large vs. Dana Small Cap | Dana Large vs. Cornerstone Moderately Aggressive | Dana Large vs. Eaton Vance Tax |
| Profunds-large Cap vs. Energy Basic Materials | Profunds-large Cap vs. Calvert Global Energy | Profunds-large Cap vs. Pimco Energy Tactical | Profunds-large Cap vs. Jennison Natural Resources |
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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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