Correlation Between Dreyfus High and Baillie Gifford
Can any of the company-specific risk be diversified away by investing in both Dreyfus High and Baillie Gifford 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 Baillie Gifford 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 Baillie Gifford Health, you can compare the effects of market volatilities on Dreyfus High and Baillie Gifford 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 Baillie Gifford. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dreyfus High and Baillie Gifford.
Diversification Opportunities for Dreyfus High and Baillie Gifford
-0.31 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Dreyfus and Baillie is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding Dreyfus High Yield and Baillie Gifford Health in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Baillie Gifford Health 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 Baillie Gifford. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Baillie Gifford Health has no effect on the direction of Dreyfus High i.e., Dreyfus High and Baillie Gifford go up and down completely randomly.
Pair Corralation between Dreyfus High and Baillie Gifford
Assuming the 90 days horizon Dreyfus High Yield is expected to generate 0.11 times more return on investment than Baillie Gifford. However, Dreyfus High Yield is 9.5 times less risky than Baillie Gifford. It trades about 0.21 of its potential returns per unit of risk. Baillie Gifford Health is currently generating about 0.0 per unit of risk. If you would invest 540.00 in Dreyfus High Yield on September 1, 2024 and sell it today you would earn a total of 4.00 from holding Dreyfus High Yield or generate 0.74% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Dreyfus High Yield vs. Baillie Gifford Health
Performance |
| Timeline |
| Dreyfus High Yield |
| Baillie Gifford Health |
Dreyfus High and Baillie Gifford Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dreyfus High and Baillie Gifford
The main advantage of trading using opposite Dreyfus High and Baillie Gifford positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dreyfus High position performs unexpectedly, Baillie Gifford 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 Baillie Gifford will offset losses from the drop in Baillie Gifford's long position.| Dreyfus High vs. Dreyfusstandish Global Fixed | Dreyfus High vs. Dreyfusstandish Global Fixed | Dreyfus High vs. Dreyfus High Yield | Dreyfus High vs. Dreyfus High Yield |
| Baillie Gifford vs. The Eafe Pure | Baillie Gifford vs. The Long Term | Baillie Gifford vs. Baillie Gifford International | Baillie Gifford vs. Baillie Gifford International |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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