Correlation Between Dreyfus Technology and Growth Opportunities
Can any of the company-specific risk be diversified away by investing in both Dreyfus Technology and Growth Opportunities 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 Growth Opportunities 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 Growth Opportunities Fund, you can compare the effects of market volatilities on Dreyfus Technology and Growth Opportunities 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 Growth Opportunities. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dreyfus Technology and Growth Opportunities.
Diversification Opportunities for Dreyfus Technology and Growth Opportunities
0.96 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Dreyfus and Growth is 0.96. Overlapping area represents the amount of risk that can be diversified away by holding Dreyfus Technology Growth and Growth Opportunities Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Growth Opportunities 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 Growth Opportunities. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Growth Opportunities has no effect on the direction of Dreyfus Technology i.e., Dreyfus Technology and Growth Opportunities go up and down completely randomly.
Pair Corralation between Dreyfus Technology and Growth Opportunities
Assuming the 90 days horizon Dreyfus Technology is expected to generate 1.04 times less return on investment than Growth Opportunities. In addition to that, Dreyfus Technology is 1.31 times more volatile than Growth Opportunities Fund. It trades about 0.08 of its total potential returns per unit of risk. Growth Opportunities Fund is currently generating about 0.1 per unit of volatility. If you would invest 4,424 in Growth Opportunities Fund on September 14, 2024 and sell it today you would earn a total of 1,315 from holding Growth Opportunities Fund or generate 29.72% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dreyfus Technology Growth vs. Growth Opportunities Fund
Performance |
| Timeline |
| Dreyfus Technology Growth |
| Growth Opportunities |
Dreyfus Technology and Growth Opportunities Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dreyfus Technology and Growth Opportunities
The main advantage of trading using opposite Dreyfus Technology and Growth Opportunities positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dreyfus Technology position performs unexpectedly, Growth Opportunities 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 Growth Opportunities will offset losses from the drop in Growth Opportunities' long position.| Dreyfus Technology vs. Veea Inc | Dreyfus Technology vs. VivoPower International PLC | Dreyfus Technology vs. Dreyfus High Yield | Dreyfus Technology vs. Dreyfusthe Boston Pany |
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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
Other Complementary Tools
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. |