Correlation Between Lazard Real and Dunham Real
Can any of the company-specific risk be diversified away by investing in both Lazard Real and Dunham Real 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 Lazard Real and Dunham Real into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lazard Real Assets and Dunham Real Estate, you can compare the effects of market volatilities on Lazard Real and Dunham Real 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 Lazard Real with a short position of Dunham Real. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lazard Real and Dunham Real.
Diversification Opportunities for Lazard Real and Dunham Real
0.72 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Lazard and Dunham is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding Lazard Real Assets and Dunham Real Estate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dunham Real Estate and Lazard Real 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 Lazard Real Assets are associated (or correlated) with Dunham Real. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dunham Real Estate has no effect on the direction of Lazard Real i.e., Lazard Real and Dunham Real go up and down completely randomly.
Pair Corralation between Lazard Real and Dunham Real
Assuming the 90 days horizon Lazard Real is expected to generate 1.55 times less return on investment than Dunham Real. But when comparing it to its historical volatility, Lazard Real Assets is 1.46 times less risky than Dunham Real. It trades about 0.1 of its potential returns per unit of risk. Dunham Real Estate is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 1,459 in Dunham Real Estate on September 15, 2024 and sell it today you would earn a total of 22.00 from holding Dunham Real Estate or generate 1.51% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
Lazard Real Assets vs. Dunham Real Estate
Performance |
Timeline |
Lazard Real Assets |
Dunham Real Estate |
Lazard Real and Dunham Real Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Lazard Real and Dunham Real
The main advantage of trading using opposite Lazard Real and Dunham Real positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lazard Real position performs unexpectedly, Dunham Real 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 Dunham Real will offset losses from the drop in Dunham Real's long position.Lazard Real vs. Lazard Global Dynamic | Lazard Real vs. Lazard Global Dynamic | Lazard Real vs. Lazard International Quality | Lazard Real vs. Lazard Small Mid Cap |
Dunham Real vs. Realty Income | Dunham Real vs. Dynex Capital | Dunham Real vs. First Industrial Realty | Dunham Real vs. Healthcare Realty Trust |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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