Correlation Between Dreyfus Bond and Locorr Macro
Can any of the company-specific risk be diversified away by investing in both Dreyfus Bond and Locorr Macro 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 Bond and Locorr Macro into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dreyfus Bond Market and Locorr Macro Strategies, you can compare the effects of market volatilities on Dreyfus Bond and Locorr Macro 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 Bond with a short position of Locorr Macro. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dreyfus Bond and Locorr Macro.
Diversification Opportunities for Dreyfus Bond and Locorr Macro
-0.54 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Dreyfus and Locorr is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding Dreyfus Bond Market and Locorr Macro Strategies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Locorr Macro Strategies and Dreyfus Bond 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 Bond Market are associated (or correlated) with Locorr Macro. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Locorr Macro Strategies has no effect on the direction of Dreyfus Bond i.e., Dreyfus Bond and Locorr Macro go up and down completely randomly.
Pair Corralation between Dreyfus Bond and Locorr Macro
Assuming the 90 days horizon Dreyfus Bond Market is expected to generate 0.61 times more return on investment than Locorr Macro. However, Dreyfus Bond Market is 1.63 times less risky than Locorr Macro. It trades about 0.23 of its potential returns per unit of risk. Locorr Macro Strategies is currently generating about -0.16 per unit of risk. If you would invest 882.00 in Dreyfus Bond Market on November 9, 2024 and sell it today you would earn a total of 12.00 from holding Dreyfus Bond Market or generate 1.36% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dreyfus Bond Market vs. Locorr Macro Strategies
Performance |
| Timeline |
| Dreyfus Bond Market |
| Locorr Macro Strategies |
Dreyfus Bond and Locorr Macro Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dreyfus Bond and Locorr Macro
The main advantage of trading using opposite Dreyfus Bond and Locorr Macro positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dreyfus Bond position performs unexpectedly, Locorr Macro 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 Locorr Macro will offset losses from the drop in Locorr Macro's long position.| Dreyfus Bond vs. Ab Bond Inflation | Dreyfus Bond vs. Doubleline Total Return | Dreyfus Bond vs. Artisan High Income | Dreyfus Bond vs. Goldman Sachs Short |
| Locorr Macro vs. Franklin Small Cap | Locorr Macro vs. Transamerica International Small | Locorr Macro vs. Ab Small Cap | Locorr Macro vs. Needham Aggressive Growth |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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