Correlation Between Highland Global and Doubleline Yield

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

By analyzing existing cross correlation between Highland Global Allocation and Doubleline Yield Opportunities, you can compare the effects of market volatilities on Highland Global and Doubleline Yield 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 Highland Global with a short position of Doubleline Yield. Check out your portfolio center. Please also check ongoing floating volatility patterns of Highland Global and Doubleline Yield.

Diversification Opportunities for Highland Global and Doubleline Yield

0.91

Correlation Coefficient

Highland Global  Doubleline Yield

Almost no diversification

The 3 months correlation between Highland and Doubleline is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding Highland Global Allocation and Doubleline Yield Opportunities in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Doubleline Yield Opp and Highland Global 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 Highland Global Allocation are associated (or correlated) with Doubleline Yield. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Doubleline Yield Opp has no effect on the direction of Highland Global i.e., Highland Global and Doubleline Yield go up and down completely randomly.

Pair Corralation between Highland Global and Doubleline Yield

Given the investment horizon of 90 days Highland Global Allocation is expected to generate 2.74 times more return on investment than Doubleline Yield. However, Highland Global is 2.74 times more volatile than Doubleline Yield Opportunities. It trades about 0.36 of its potential returns per unit of risk. Doubleline Yield Opportunities is currently generating about 0.17 per unit of risk. If you would invest  657.00  in Highland Global Allocation on December 30, 2024 and sell it today you would earn a total of  177.00  from holding Highland Global Allocation or generate 26.94% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Strong
Accuracy	100.0%
Values	Daily Returns

Highland Global Allocation  vs.  Doubleline Yield Opportunities

Highland Global Allo

Risk-Adjusted Performance

Strong

Compared to the overall equity markets, risk-adjusted returns on investments in Highland Global Allocation are ranked lower than 28 (%) of all funds and portfolios of funds over the last 90 days. Despite somewhat weak essential indicators, Highland Global sustained solid returns over the last few months and may actually be approaching a breakup point.

Doubleline Yield Opp

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Doubleline Yield Opportunities are ranked lower than 13 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong essential indicators, Doubleline Yield is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Highland Global and Doubleline Yield

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

The idea behind Highland Global Allocation and Doubleline Yield Opportunities 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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.