Correlation Between Dreyfus Yield and Dreyfus High
Can any of the company-specific risk be diversified away by investing in both Dreyfus Yield and Dreyfus High 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 Dreyfus Yield and Dreyfus High into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dreyfus Yield Enhancement and Dreyfus High Yield, you can compare the effects of market volatilities on Dreyfus Yield and Dreyfus High 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 Dreyfus Yield with a short position of Dreyfus High. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dreyfus Yield and Dreyfus High.
Diversification Opportunities for Dreyfus Yield and Dreyfus High
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Dreyfus and Dreyfus is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Dreyfus Yield Enhancement and Dreyfus High Yield in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dreyfus High Yield and Dreyfus Yield 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 Dreyfus Yield Enhancement are associated (or correlated) with Dreyfus High. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dreyfus High Yield has no effect on the direction of Dreyfus Yield i.e., Dreyfus Yield and Dreyfus High go up and down completely randomly.
Pair Corralation between Dreyfus Yield and Dreyfus High
Assuming the 90 days horizon Dreyfus Yield Enhancement is expected to generate 0.36 times more return on investment than Dreyfus High. However, Dreyfus Yield Enhancement is 2.82 times less risky than Dreyfus High. It trades about 0.03 of its potential returns per unit of risk. Dreyfus High Yield is currently generating about -0.02 per unit of risk. If you would invest 1,133 in Dreyfus Yield Enhancement on August 30, 2024 and sell it today you would earn a total of 2.00 from holding Dreyfus Yield Enhancement or generate 0.18% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dreyfus Yield Enhancement vs. Dreyfus High Yield
Performance |
| Timeline |
| Dreyfus Yield Enhancement |
| Dreyfus High Yield |
Dreyfus Yield and Dreyfus High Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dreyfus Yield and Dreyfus High
The main advantage of trading using opposite Dreyfus Yield and Dreyfus High positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dreyfus Yield position performs unexpectedly, Dreyfus High 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 High will offset losses from the drop in Dreyfus High's long position.| Dreyfus Yield vs. Dreyfus High Yield | Dreyfus Yield vs. Dreyfusthe Boston Pany | Dreyfus Yield vs. Dreyfus International Bond | Dreyfus Yield vs. Dreyfus International Bond |
| Dreyfus High vs. Fidelity Series 1000 | Dreyfus High vs. Pace Large Value | Dreyfus High vs. Aqr Large Cap | Dreyfus High vs. Virtus Nfj Large Cap |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
Other Complementary Tools
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities | |
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals |