Correlation Between Dreyfus Natural and Calamos Total
Can any of the company-specific risk be diversified away by investing in both Dreyfus Natural and Calamos Total 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 Natural and Calamos Total into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dreyfus Natural Resources and Calamos Total Return, you can compare the effects of market volatilities on Dreyfus Natural and Calamos Total 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 Natural with a short position of Calamos Total. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dreyfus Natural and Calamos Total.
Diversification Opportunities for Dreyfus Natural and Calamos Total
-0.51 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Dreyfus and Calamos is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding Dreyfus Natural Resources and Calamos Total Return in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Calamos Total Return and Dreyfus Natural 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 Natural Resources are associated (or correlated) with Calamos Total. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Calamos Total Return has no effect on the direction of Dreyfus Natural i.e., Dreyfus Natural and Calamos Total go up and down completely randomly.
Pair Corralation between Dreyfus Natural and Calamos Total
Assuming the 90 days horizon Dreyfus Natural Resources is expected to generate 3.27 times more return on investment than Calamos Total. However, Dreyfus Natural is 3.27 times more volatile than Calamos Total Return. It trades about 0.06 of its potential returns per unit of risk. Calamos Total Return is currently generating about -0.14 per unit of risk. If you would invest 4,244 in Dreyfus Natural Resources on August 29, 2024 and sell it today you would earn a total of 108.00 from holding Dreyfus Natural Resources or generate 2.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dreyfus Natural Resources vs. Calamos Total Return
Performance |
| Timeline |
| Dreyfus Natural Resources |
| Calamos Total Return |
Dreyfus Natural and Calamos Total Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dreyfus Natural and Calamos Total
The main advantage of trading using opposite Dreyfus Natural and Calamos Total positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dreyfus Natural position performs unexpectedly, Calamos Total 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 Calamos Total will offset losses from the drop in Calamos Total's long position.The idea behind Dreyfus Natural Resources and Calamos Total Return pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Calamos Total vs. Goldman Sachs Mlp | Calamos Total vs. Clearbridge Energy Mlp | Calamos Total vs. Ivy Natural Resources | Calamos Total vs. Dreyfus Natural Resources |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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