Correlation Between Dreyfus International and Lazard Developing
Can any of the company-specific risk be diversified away by investing in both Dreyfus International and Lazard Developing 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 International and Lazard Developing into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dreyfus International Bond and Lazard Developing Markets, you can compare the effects of market volatilities on Dreyfus International and Lazard Developing 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 International with a short position of Lazard Developing. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dreyfus International and Lazard Developing.
Diversification Opportunities for Dreyfus International and Lazard Developing
0.06 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Dreyfus and Lazard is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding Dreyfus International Bond and Lazard Developing Markets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lazard Developing Markets and Dreyfus International 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 International Bond are associated (or correlated) with Lazard Developing. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lazard Developing Markets has no effect on the direction of Dreyfus International i.e., Dreyfus International and Lazard Developing go up and down completely randomly.
Pair Corralation between Dreyfus International and Lazard Developing
Assuming the 90 days horizon Dreyfus International Bond is expected to generate 0.48 times more return on investment than Lazard Developing. However, Dreyfus International Bond is 2.1 times less risky than Lazard Developing. It trades about 0.15 of its potential returns per unit of risk. Lazard Developing Markets is currently generating about -0.08 per unit of risk. If you would invest 1,247 in Dreyfus International Bond on September 12, 2024 and sell it today you would earn a total of 14.00 from holding Dreyfus International Bond or generate 1.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Dreyfus International Bond vs. Lazard Developing Markets
Performance |
| Timeline |
| Dreyfus International |
| Lazard Developing Markets |
Dreyfus International and Lazard Developing Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dreyfus International and Lazard Developing
The main advantage of trading using opposite Dreyfus International and Lazard Developing positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dreyfus International position performs unexpectedly, Lazard Developing 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 Lazard Developing will offset losses from the drop in Lazard Developing's long position.| Dreyfus International vs. Simt Real Estate | Dreyfus International vs. Prudential Real Estate | Dreyfus International vs. Jhancock Real Estate | Dreyfus International vs. Sa Real Estate |
| Lazard Developing vs. Equity Series Class | Lazard Developing vs. Dreyfus International Bond | Lazard Developing vs. Blackrock Hi Yld | Lazard Developing vs. Heartland Value Plus |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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