Correlation Between Federated High and Dreyfus Short
Can any of the company-specific risk be diversified away by investing in both Federated High and Dreyfus Short 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 Federated High and Dreyfus Short into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Federated High Income and Dreyfus Short Intermediate, you can compare the effects of market volatilities on Federated High and Dreyfus Short 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 Federated High with a short position of Dreyfus Short. Check out your portfolio center. Please also check ongoing floating volatility patterns of Federated High and Dreyfus Short.
Diversification Opportunities for Federated High and Dreyfus Short
0.58 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Federated and Dreyfus is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding Federated High Income and Dreyfus Short Intermediate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dreyfus Short Interm and Federated 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 Federated High Income are associated (or correlated) with Dreyfus Short. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dreyfus Short Interm has no effect on the direction of Federated High i.e., Federated High and Dreyfus Short go up and down completely randomly.
Pair Corralation between Federated High and Dreyfus Short
If you would invest 1,278 in Dreyfus Short Intermediate on September 14, 2024 and sell it today you would earn a total of 3.00 from holding Dreyfus Short Intermediate or generate 0.23% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 4.76% |
| Values | Daily Returns |
Federated High Income vs. Dreyfus Short Intermediate
Performance |
| Timeline |
| Federated High Income |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Dreyfus Short Interm |
Federated High and Dreyfus Short Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Federated High and Dreyfus Short
The main advantage of trading using opposite Federated High and Dreyfus Short positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Federated High position performs unexpectedly, Dreyfus Short 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 Short will offset losses from the drop in Dreyfus Short's long position.| Federated High vs. Ab Bond Inflation | Federated High vs. Arrow Managed Futures | Federated High vs. Ab Bond Inflation | Federated High vs. Atac Inflation Rotation |
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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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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