Correlation Between Dreyfus/standish and Nasdaq-100(r)
Can any of the company-specific risk be diversified away by investing in both Dreyfus/standish and Nasdaq-100(r) 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/standish and Nasdaq-100(r) into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dreyfusstandish Global Fixed and Nasdaq 100 2x Strategy, you can compare the effects of market volatilities on Dreyfus/standish and Nasdaq-100(r) 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/standish with a short position of Nasdaq-100(r). Check out your portfolio center. Please also check ongoing floating volatility patterns of Dreyfus/standish and Nasdaq-100(r).
Diversification Opportunities for Dreyfus/standish and Nasdaq-100(r)
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Dreyfus/standish and Nasdaq-100(r) is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Dreyfusstandish Global Fixed and Nasdaq 100 2x Strategy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nasdaq 100 2x and Dreyfus/standish 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 Dreyfusstandish Global Fixed are associated (or correlated) with Nasdaq-100(r). Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nasdaq 100 2x has no effect on the direction of Dreyfus/standish i.e., Dreyfus/standish and Nasdaq-100(r) go up and down completely randomly.
Pair Corralation between Dreyfus/standish and Nasdaq-100(r)
Assuming the 90 days horizon Dreyfus/standish is expected to generate 2.01 times less return on investment than Nasdaq-100(r). But when comparing it to its historical volatility, Dreyfusstandish Global Fixed is 10.23 times less risky than Nasdaq-100(r). It trades about 0.12 of its potential returns per unit of risk. Nasdaq 100 2x Strategy is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 39,847 in Nasdaq 100 2x Strategy on November 4, 2024 and sell it today you would earn a total of 226.00 from holding Nasdaq 100 2x Strategy or generate 0.57% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dreyfusstandish Global Fixed vs. Nasdaq 100 2x Strategy
Performance |
| Timeline |
| Dreyfusstandish Global |
| Nasdaq 100 2x |
Dreyfus/standish and Nasdaq-100(r) Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dreyfus/standish and Nasdaq-100(r)
The main advantage of trading using opposite Dreyfus/standish and Nasdaq-100(r) positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dreyfus/standish position performs unexpectedly, Nasdaq-100(r) 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 Nasdaq-100(r) will offset losses from the drop in Nasdaq-100(r)'s long position.| Dreyfus/standish vs. Madison Diversified Income | Dreyfus/standish vs. Federated Hermes Conservative | Dreyfus/standish vs. Lord Abbett Diversified | Dreyfus/standish vs. Wilmington Diversified Income |
| Nasdaq-100(r) vs. John Hancock Money | Nasdaq-100(r) vs. Financials Ultrasector Profund | Nasdaq-100(r) vs. Fidelity Advisor Financial | Nasdaq-100(r) vs. Hewitt Money Market |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
Other Complementary Tools
| Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Share Portfolio Track or share privately all of your investments from the convenience of any device | |
| Transaction History View history of all your transactions and understand their impact on performance | |
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world |