Correlation Between Dreyfus Municipal and Dreyfus Gnma
Can any of the company-specific risk be diversified away by investing in both Dreyfus Municipal and Dreyfus Gnma 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 Municipal and Dreyfus Gnma into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dreyfus Municipal Bond and Dreyfus Gnma Fund, you can compare the effects of market volatilities on Dreyfus Municipal and Dreyfus Gnma 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 Municipal with a short position of Dreyfus Gnma. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dreyfus Municipal and Dreyfus Gnma.
Diversification Opportunities for Dreyfus Municipal and Dreyfus Gnma
-0.29 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Dreyfus and Dreyfus is -0.29. Overlapping area represents the amount of risk that can be diversified away by holding Dreyfus Municipal Bond and Dreyfus Gnma Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dreyfus Gnma and Dreyfus Municipal 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 Municipal Bond are associated (or correlated) with Dreyfus Gnma. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dreyfus Gnma has no effect on the direction of Dreyfus Municipal i.e., Dreyfus Municipal and Dreyfus Gnma go up and down completely randomly.
Pair Corralation between Dreyfus Municipal and Dreyfus Gnma
If you would invest 1,271 in Dreyfus Gnma Fund on September 1, 2024 and sell it today you would earn a total of 14.00 from holding Dreyfus Gnma Fund or generate 1.1% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 4.55% |
| Values | Daily Returns |
Dreyfus Municipal Bond vs. Dreyfus Gnma Fund
Performance |
| Timeline |
| Dreyfus Municipal Bond |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Dreyfus Gnma |
Dreyfus Municipal and Dreyfus Gnma Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dreyfus Municipal and Dreyfus Gnma
The main advantage of trading using opposite Dreyfus Municipal and Dreyfus Gnma positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dreyfus Municipal position performs unexpectedly, Dreyfus Gnma 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 Dreyfus Gnma will offset losses from the drop in Dreyfus Gnma's long position.| Dreyfus Municipal vs. Dreyfus Intermediate Municipal | Dreyfus Municipal vs. Dreyfus Gnma Fund | Dreyfus Municipal vs. Fidelity Municipal Income | Dreyfus Municipal vs. T Rowe Price |
| Dreyfus Gnma vs. Dreyfusstandish Global Fixed | Dreyfus Gnma vs. Dreyfusstandish Global Fixed | Dreyfus Gnma vs. Dreyfus High Yield | Dreyfus Gnma vs. Dreyfus High Yield |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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