Correlation Between Auer Growth and The Dreyfus
Can any of the company-specific risk be diversified away by investing in both Auer Growth and The Dreyfus 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 Auer Growth and The Dreyfus into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Auer Growth Fund and The Dreyfus Sustainable, you can compare the effects of market volatilities on Auer Growth and The Dreyfus 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 Auer Growth with a short position of The Dreyfus. Check out your portfolio center. Please also check ongoing floating volatility patterns of Auer Growth and The Dreyfus.
Diversification Opportunities for Auer Growth and The Dreyfus
0.78 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Auer and The is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding Auer Growth Fund and The Dreyfus Sustainable in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on The Dreyfus Sustainable and Auer Growth 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 Auer Growth Fund are associated (or correlated) with The Dreyfus. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of The Dreyfus Sustainable has no effect on the direction of Auer Growth i.e., Auer Growth and The Dreyfus go up and down completely randomly.
Pair Corralation between Auer Growth and The Dreyfus
Assuming the 90 days horizon Auer Growth Fund is expected to generate 1.14 times more return on investment than The Dreyfus. However, Auer Growth is 1.14 times more volatile than The Dreyfus Sustainable. It trades about 0.25 of its potential returns per unit of risk. The Dreyfus Sustainable is currently generating about 0.27 per unit of risk. If you would invest 1,681 in Auer Growth Fund on September 1, 2024 and sell it today you would earn a total of 87.00 from holding Auer Growth Fund or generate 5.18% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Auer Growth Fund vs. The Dreyfus Sustainable
Performance |
| Timeline |
| Auer Growth Fund |
| The Dreyfus Sustainable |
Auer Growth and The Dreyfus Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Auer Growth and The Dreyfus
The main advantage of trading using opposite Auer Growth and The Dreyfus positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Auer Growth position performs unexpectedly, The Dreyfus 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 The Dreyfus will offset losses from the drop in The Dreyfus' long position.| Auer Growth vs. Lebenthal Lisanti Small | Auer Growth vs. Hodges Small Cap | Auer Growth vs. Schwartz Value Focused | Auer Growth vs. Oberweis Small Cap Opportunities |
| The Dreyfus vs. Artisan Thematic Fund | The Dreyfus vs. Commonwealth Global Fund | The Dreyfus vs. Auer Growth Fund | The Dreyfus vs. Small Cap Stock |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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