Correlation Between Dunham Floating and Rbc Funds

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

By analyzing existing cross correlation between Dunham Floating Rate and Rbc Funds Trust, you can compare the effects of market volatilities on Dunham Floating and Rbc Funds 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 Floating with a short position of Rbc Funds. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dunham Floating and Rbc Funds.

Diversification Opportunities for Dunham Floating and Rbc Funds

0.29

Correlation Coefficient

Dunham Floating  Rbc Funds

Modest diversification

The 3 months correlation between Dunham and Rbc is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding Dunham Floating Rate and Rbc Funds Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Rbc Funds Trust and Dunham Floating 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 Floating Rate are associated (or correlated) with Rbc Funds. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Rbc Funds Trust has no effect on the direction of Dunham Floating i.e., Dunham Floating and Rbc Funds go up and down completely randomly.

Pair Corralation between Dunham Floating and Rbc Funds

Assuming the 90 days horizon Dunham Floating is expected to generate 25.16 times less return on investment than Rbc Funds. But when comparing it to its historical volatility, Dunham Floating Rate is 10.25 times less risky than Rbc Funds. It trades about 0.06 of its potential returns per unit of risk. Rbc Funds Trust is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest  784.00  in Rbc Funds Trust on December 28, 2024 and sell it today you would earn a total of  69.00  from holding Rbc Funds Trust or generate 8.8% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	98.36%
Values	Daily Returns

Dunham Floating Rate  vs.  Rbc Funds Trust

Dunham Floating Rate

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Dunham Floating Rate are ranked lower than 4 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, Dunham Floating is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Rbc Funds Trust

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Rbc Funds Trust are ranked lower than 11 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak basic indicators, Rbc Funds may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with Dunham Floating and Rbc Funds

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

The idea behind Dunham Floating Rate and Rbc Funds Trust 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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.