Correlation Between Dunham Appreciation and India Closed

Can any of the company-specific risk be diversified away by investing in both Dunham Appreciation and India Closed 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 Appreciation and India Closed into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Dunham Appreciation Income and India Closed, you can compare the effects of market volatilities on Dunham Appreciation and India Closed 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 Appreciation with a short position of India Closed. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dunham Appreciation and India Closed.

Diversification Opportunities for Dunham Appreciation and India Closed

-0.86

Correlation Coefficient

Dunham Appreciation  India Closed

Pay attention - limited upside

The 3 months correlation between Dunham and India is -0.86. Overlapping area represents the amount of risk that can be diversified away by holding Dunham Appreciation Income and India Closed in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on India Closed and Dunham Appreciation 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 Appreciation Income are associated (or correlated) with India Closed. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of India Closed has no effect on the direction of Dunham Appreciation i.e., Dunham Appreciation and India Closed go up and down completely randomly.

Pair Corralation between Dunham Appreciation and India Closed

Assuming the 90 days horizon Dunham Appreciation is expected to generate 5.03 times less return on investment than India Closed. But when comparing it to its historical volatility, Dunham Appreciation Income is 9.32 times less risky than India Closed. It trades about 0.1 of its potential returns per unit of risk. India Closed is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest  1,254  in India Closed on September 28, 2024 and sell it today you would earn a total of  346.00  from holding India Closed or generate 27.59% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Significant
Accuracy	99.8%
Values	Daily Returns

Dunham Appreciation Income  vs.  India Closed

Dunham Appreciation

Risk-Adjusted Performance

14 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Dunham Appreciation Income are ranked lower than 14 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong forward indicators, Dunham Appreciation is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

India Closed

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days India Closed has generated negative risk-adjusted returns adding no value to fund investors. In spite of unfluctuating performance in the last few months, the Fund's technical and fundamental indicators remain very healthy which may send shares a bit higher in January 2025. The recent disarray may also be a sign of long period up-swing for the fund investors.

Pair Trading with Dunham Appreciation and India Closed

The main advantage of trading using opposite Dunham Appreciation and India Closed positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dunham Appreciation position performs unexpectedly, India Closed 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 India Closed will offset losses from the drop in India Closed's long position.

The idea behind Dunham Appreciation Income and India Closed pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.