Correlation Between Barings Active and Dreyfus Floating
Can any of the company-specific risk be diversified away by investing in both Barings Active and Dreyfus Floating 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 Barings Active and Dreyfus Floating into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Barings Active Short and Dreyfus Floating Rate, you can compare the effects of market volatilities on Barings Active and Dreyfus Floating 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 Barings Active with a short position of Dreyfus Floating. Check out your portfolio center. Please also check ongoing floating volatility patterns of Barings Active and Dreyfus Floating.
Diversification Opportunities for Barings Active and Dreyfus Floating
0.39 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Barings and Dreyfus is 0.39. Overlapping area represents the amount of risk that can be diversified away by holding Barings Active Short and Dreyfus Floating Rate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dreyfus Floating Rate and Barings Active 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 Barings Active Short are associated (or correlated) with Dreyfus Floating. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dreyfus Floating Rate has no effect on the direction of Barings Active i.e., Barings Active and Dreyfus Floating go up and down completely randomly.
Pair Corralation between Barings Active and Dreyfus Floating
Assuming the 90 days horizon Barings Active is expected to generate 1.54 times less return on investment than Dreyfus Floating. In addition to that, Barings Active is 1.61 times more volatile than Dreyfus Floating Rate. It trades about 0.17 of its total potential returns per unit of risk. Dreyfus Floating Rate is currently generating about 0.42 per unit of volatility. If you would invest 912.00 in Dreyfus Floating Rate on September 14, 2024 and sell it today you would earn a total of 208.00 from holding Dreyfus Floating Rate or generate 22.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Barings Active Short vs. Dreyfus Floating Rate
Performance |
| Timeline |
| Barings Active Short |
| Dreyfus Floating Rate |
Barings Active and Dreyfus Floating Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Barings Active and Dreyfus Floating
The main advantage of trading using opposite Barings Active and Dreyfus Floating positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Barings Active position performs unexpectedly, Dreyfus Floating 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 Dreyfus Floating will offset losses from the drop in Dreyfus Floating's long position.| Barings Active vs. Champlain Small | Barings Active vs. Franklin Small Cap | Barings Active vs. Touchstone Small Cap | Barings Active vs. Df Dent Small |
| Dreyfus Floating vs. Angel Oak Ultrashort | Dreyfus Floating vs. Blackrock Short Term Inflat Protected | Dreyfus Floating vs. Boston Partners Longshort | Dreyfus Floating vs. Barings Active Short |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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