Correlation Between Doubleline Shiller and Doubleline Multi

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

By analyzing existing cross correlation between Doubleline Shiller Enhanced and Doubleline Multi Asset Trend, you can compare the effects of market volatilities on Doubleline Shiller and Doubleline Multi 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 Doubleline Shiller with a short position of Doubleline Multi. Check out your portfolio center. Please also check ongoing floating volatility patterns of Doubleline Shiller and Doubleline Multi.

Diversification Opportunities for Doubleline Shiller and Doubleline Multi

0.88

Correlation Coefficient

Doubleline Shiller  Doubleline Multi

Very poor diversification

The 3 months correlation between Doubleline and Doubleline is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Doubleline Shiller Enhanced and Doubleline Multi Asset Trend in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Doubleline Multi Asset and Doubleline Shiller 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 Doubleline Shiller Enhanced are associated (or correlated) with Doubleline Multi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Doubleline Multi Asset has no effect on the direction of Doubleline Shiller i.e., Doubleline Shiller and Doubleline Multi go up and down completely randomly.

Pair Corralation between Doubleline Shiller and Doubleline Multi

Assuming the 90 days horizon Doubleline Shiller Enhanced is expected to under-perform the Doubleline Multi. In addition to that, Doubleline Shiller is 1.67 times more volatile than Doubleline Multi Asset Trend. It trades about -0.13 of its total potential returns per unit of risk. Doubleline Multi Asset Trend is currently generating about -0.09 per unit of volatility. If you would invest  760.00  in Doubleline Multi Asset Trend on September 13, 2024 and sell it today you would lose (23.00) from holding Doubleline Multi Asset Trend or give up 3.03% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Strong
Accuracy	96.83%
Values	Daily Returns

Doubleline Shiller Enhanced  vs.  Doubleline Multi Asset Trend

Doubleline Shiller

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Doubleline Shiller Enhanced has generated negative risk-adjusted returns adding no value to fund investors. In spite of latest weak performance, the Fund's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the fund investors.

Doubleline Multi Asset

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Doubleline Multi Asset Trend has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong basic indicators, Doubleline Multi is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Doubleline Shiller and Doubleline Multi

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

The idea behind Doubleline Shiller Enhanced and Doubleline Multi Asset Trend 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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.