Correlation Between Dreyfus High and Bny Mellon
Can any of the company-specific risk be diversified away by investing in both Dreyfus High and Bny Mellon 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 High and Bny Mellon into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dreyfus High Yield and Bny Mellon Short, you can compare the effects of market volatilities on Dreyfus High and Bny Mellon 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 High with a short position of Bny Mellon. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dreyfus High and Bny Mellon.
Diversification Opportunities for Dreyfus High and Bny Mellon
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Dreyfus and Bny is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Dreyfus High Yield and Bny Mellon Short in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bny Mellon Short and Dreyfus High 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 High Yield are associated (or correlated) with Bny Mellon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bny Mellon Short has no effect on the direction of Dreyfus High i.e., Dreyfus High and Bny Mellon go up and down completely randomly.
Pair Corralation between Dreyfus High and Bny Mellon
Assuming the 90 days horizon Dreyfus High Yield is expected to generate 1.59 times more return on investment than Bny Mellon. However, Dreyfus High is 1.59 times more volatile than Bny Mellon Short. It trades about 0.41 of its potential returns per unit of risk. Bny Mellon Short is currently generating about 0.1 per unit of risk. If you would invest 1,101 in Dreyfus High Yield on September 12, 2024 and sell it today you would earn a total of 15.00 from holding Dreyfus High Yield or generate 1.36% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dreyfus High Yield vs. Bny Mellon Short
Performance |
| Timeline |
| Dreyfus High Yield |
| Bny Mellon Short |
Dreyfus High and Bny Mellon Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dreyfus High and Bny Mellon
The main advantage of trading using opposite Dreyfus High and Bny Mellon positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dreyfus High position performs unexpectedly, Bny Mellon 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 Bny Mellon will offset losses from the drop in Bny Mellon's long position.| Dreyfus High vs. Nuveen High Yield | Dreyfus High vs. Nuveen High Yield | Dreyfus High vs. SCOR PK | Dreyfus High vs. Morningstar Unconstrained Allocation |
| Bny Mellon vs. Goldman Sachs Clean | Bny Mellon vs. Global Gold Fund | Bny Mellon vs. Vy Goldman Sachs | Bny Mellon vs. Oppenheimer Gold Special |
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 Stocks Directory module to find actively traded stocks across global markets.
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