Correlation Between Dreyfus Technology and Deutsche Health

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Can any of the company-specific risk be diversified away by investing in both Dreyfus Technology and Deutsche Health 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 Technology and Deutsche Health into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dreyfus Technology Growth and Deutsche Health And, you can compare the effects of market volatilities on Dreyfus Technology and Deutsche Health 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 Technology with a short position of Deutsche Health. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dreyfus Technology and Deutsche Health.

Diversification Opportunities for Dreyfus Technology and Deutsche Health

-0.75
  Correlation Coefficient

Pay attention - limited upside

The 3 months correlation between Dreyfus and Deutsche is -0.75. Overlapping area represents the amount of risk that can be diversified away by holding Dreyfus Technology Growth and Deutsche Health And in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Deutsche Health And and Dreyfus Technology 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 Technology Growth are associated (or correlated) with Deutsche Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Deutsche Health And has no effect on the direction of Dreyfus Technology i.e., Dreyfus Technology and Deutsche Health go up and down completely randomly.

Pair Corralation between Dreyfus Technology and Deutsche Health

Assuming the 90 days horizon Dreyfus Technology Growth is expected to generate 1.26 times more return on investment than Deutsche Health. However, Dreyfus Technology is 1.26 times more volatile than Deutsche Health And. It trades about 0.11 of its potential returns per unit of risk. Deutsche Health And is currently generating about 0.01 per unit of risk. If you would invest  3,904  in Dreyfus Technology Growth on September 12, 2024 and sell it today you would earn a total of  4,039  from holding Dreyfus Technology Growth or generate 103.46% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthWeak
Accuracy100.0%
ValuesDaily Returns

Dreyfus Technology Growth  vs.  Deutsche Health And

 Performance 
       Timeline  
Dreyfus Technology Growth 

Risk-Adjusted Performance

11 of 100

 
Weak
 
Strong
Good
Compared to the overall equity markets, risk-adjusted returns on investments in Dreyfus Technology Growth are ranked lower than 11 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak basic indicators, Dreyfus Technology may actually be approaching a critical reversion point that can send shares even higher in January 2025.
Deutsche Health And 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Deutsche Health And has generated negative risk-adjusted returns adding no value to fund investors. In spite of latest weak performance, the Fund's fundamental indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the fund investors.

Dreyfus Technology and Deutsche Health Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Dreyfus Technology and Deutsche Health

The main advantage of trading using opposite Dreyfus Technology and Deutsche Health positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dreyfus Technology position performs unexpectedly, Deutsche Health 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 Deutsche Health will offset losses from the drop in Deutsche Health's long position.
The idea behind Dreyfus Technology Growth and Deutsche Health And 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.
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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 Directory module to find actively traded commodities issued by global exchanges.

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