Correlation Between Doubleline Total and Global Diversified

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

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

Diversification Opportunities for Doubleline Total and Global Diversified

0.82

Correlation Coefficient

Doubleline Total  Global Diversified

Very poor diversification

The 3 months correlation between Doubleline and Global is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Doubleline Total Return and Global Diversified Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Global Diversified Income and Doubleline Total 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 Total Return are associated (or correlated) with Global Diversified. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Global Diversified Income has no effect on the direction of Doubleline Total i.e., Doubleline Total and Global Diversified go up and down completely randomly.

Pair Corralation between Doubleline Total and Global Diversified

Assuming the 90 days horizon Doubleline Total is expected to generate 1.04 times less return on investment than Global Diversified. In addition to that, Doubleline Total is 1.88 times more volatile than Global Diversified Income. It trades about 0.1 of its total potential returns per unit of risk. Global Diversified Income is currently generating about 0.2 per unit of volatility. If you would invest  1,162  in Global Diversified Income on May 5, 2025 and sell it today you would earn a total of  24.00  from holding Global Diversified Income or generate 2.07% return on investment over 90 days.

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

Doubleline Total Return  vs.  Global Diversified Income

Doubleline Total Return

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Doubleline Total Return are ranked lower than 7 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, Doubleline Total is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Global Diversified Income

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Global Diversified Income are ranked lower than 15 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong fundamental indicators, Global Diversified 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 Total and Global Diversified

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

The idea behind Doubleline Total Return and Global Diversified Income 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 Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.