Correlation Between Dreyfus High and Dreyfus Floating
Can any of the company-specific risk be diversified away by investing in both Dreyfus High 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 Dreyfus High and Dreyfus Floating 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 Dreyfus Floating Rate, you can compare the effects of market volatilities on Dreyfus High 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 Dreyfus High with a short position of Dreyfus Floating. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dreyfus High and Dreyfus Floating.
Diversification Opportunities for Dreyfus High and Dreyfus Floating
-0.07 | Correlation Coefficient |
Good diversification
The 3 months correlation between Dreyfus and Dreyfus is -0.07. Overlapping area represents the amount of risk that can be diversified away by holding Dreyfus High Yield 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 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 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 Dreyfus High i.e., Dreyfus High and Dreyfus Floating go up and down completely randomly.
Pair Corralation between Dreyfus High and Dreyfus Floating
Assuming the 90 days horizon Dreyfus High is expected to generate 1.92 times less return on investment than Dreyfus Floating. In addition to that, Dreyfus High is 3.77 times more volatile than Dreyfus Floating Rate. It trades about 0.06 of its total potential returns per unit of risk. Dreyfus Floating Rate is currently generating about 0.45 per unit of volatility. If you would invest 909.00 in Dreyfus Floating Rate on August 30, 2024 and sell it today you would earn a total of 215.00 from holding Dreyfus Floating Rate or generate 23.65% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dreyfus High Yield vs. Dreyfus Floating Rate
Performance |
| Timeline |
| Dreyfus High Yield |
| Dreyfus Floating Rate |
Dreyfus High and Dreyfus Floating Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dreyfus High and Dreyfus Floating
The main advantage of trading using opposite Dreyfus High and Dreyfus Floating positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dreyfus High 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.| Dreyfus High vs. Nuveen High Yield | Dreyfus High vs. Nuveen High Yield | Dreyfus High vs. Nuveen High Yield | Dreyfus High vs. American High Income Municipal |
| Dreyfus Floating vs. Energy Services Fund | Dreyfus Floating vs. Goldman Sachs Mlp | Dreyfus Floating vs. Calvert Global Energy | Dreyfus Floating vs. Victory Global Natural |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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