Correlation Between Dreyfus Opportunistic and International Equity
Can any of the company-specific risk be diversified away by investing in both Dreyfus Opportunistic and International Equity 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 Opportunistic and International Equity into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dreyfus Opportunistic Midcap and International Equity Portfolio, you can compare the effects of market volatilities on Dreyfus Opportunistic and International Equity 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 Opportunistic with a short position of International Equity. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dreyfus Opportunistic and International Equity.
Diversification Opportunities for Dreyfus Opportunistic and International Equity
-0.59 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between DREYFUS and International is -0.59. Overlapping area represents the amount of risk that can be diversified away by holding Dreyfus Opportunistic Midcap and International Equity Portfolio in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on International Equity and Dreyfus Opportunistic 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 Opportunistic Midcap are associated (or correlated) with International Equity. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of International Equity has no effect on the direction of Dreyfus Opportunistic i.e., Dreyfus Opportunistic and International Equity go up and down completely randomly.
Pair Corralation between Dreyfus Opportunistic and International Equity
Assuming the 90 days horizon Dreyfus Opportunistic Midcap is expected to generate 0.93 times more return on investment than International Equity. However, Dreyfus Opportunistic Midcap is 1.08 times less risky than International Equity. It trades about 0.36 of its potential returns per unit of risk. International Equity Portfolio is currently generating about -0.1 per unit of risk. If you would invest 3,343 in Dreyfus Opportunistic Midcap on September 4, 2024 and sell it today you would earn a total of 229.00 from holding Dreyfus Opportunistic Midcap or generate 6.85% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.24% |
| Values | Daily Returns |
Dreyfus Opportunistic Midcap vs. International Equity Portfolio
Performance |
| Timeline |
| Dreyfus Opportunistic |
| International Equity |
Dreyfus Opportunistic and International Equity Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dreyfus Opportunistic and International Equity
The main advantage of trading using opposite Dreyfus Opportunistic and International Equity positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dreyfus Opportunistic position performs unexpectedly, International Equity 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 International Equity will offset losses from the drop in International Equity's long position.| Dreyfus Opportunistic vs. Qs Growth Fund | Dreyfus Opportunistic vs. Ab Small Cap | Dreyfus Opportunistic vs. Artisan Thematic Fund | Dreyfus Opportunistic vs. Volumetric Fund Volumetric |
| International Equity vs. Emerging Markets Equity | International Equity vs. Global Fixed Income | International Equity vs. Global Fixed Income | International Equity vs. Global Fixed Income |
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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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