Correlation Between Dreyfus Natural and Hartford Growth
Can any of the company-specific risk be diversified away by investing in both Dreyfus Natural and Hartford Growth 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 Hartford Growth 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 The Hartford Growth, you can compare the effects of market volatilities on Dreyfus Natural and Hartford Growth 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 Hartford Growth. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dreyfus Natural and Hartford Growth.
Diversification Opportunities for Dreyfus Natural and Hartford Growth
0.78 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Dreyfus and Hartford is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding Dreyfus Natural Resources and The Hartford Growth in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hartford Growth 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 Hartford Growth. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hartford Growth has no effect on the direction of Dreyfus Natural i.e., Dreyfus Natural and Hartford Growth go up and down completely randomly.
Pair Corralation between Dreyfus Natural and Hartford Growth
Assuming the 90 days horizon Dreyfus Natural is expected to generate 1.84 times less return on investment than Hartford Growth. In addition to that, Dreyfus Natural is 1.01 times more volatile than The Hartford Growth. It trades about 0.11 of its total potential returns per unit of risk. The Hartford Growth is currently generating about 0.21 per unit of volatility. If you would invest 5,697 in The Hartford Growth on September 3, 2024 and sell it today you would earn a total of 873.00 from holding The Hartford Growth or generate 15.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dreyfus Natural Resources vs. The Hartford Growth
Performance |
| Timeline |
| Dreyfus Natural Resources |
| Hartford Growth |
Dreyfus Natural and Hartford Growth Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dreyfus Natural and Hartford Growth
The main advantage of trading using opposite Dreyfus Natural and Hartford Growth positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dreyfus Natural position performs unexpectedly, Hartford Growth 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 Hartford Growth will offset losses from the drop in Hartford Growth's long position.| Dreyfus Natural vs. Hsbc Treasury Money | Dreyfus Natural vs. Elfun Government Money | Dreyfus Natural vs. Schwab Treasury Money | Dreyfus Natural vs. Prudential Government Money |
| Hartford Growth vs. Salient Mlp Energy | Hartford Growth vs. Oil Gas Ultrasector | Hartford Growth vs. Dreyfus Natural Resources | Hartford Growth vs. Tortoise Energy Independence |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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