Correlation Between Lord Abbett and Dreyfus Active
Can any of the company-specific risk be diversified away by investing in both Lord Abbett and Dreyfus Active 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 Lord Abbett and Dreyfus Active into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lord Abbett Diversified and Dreyfus Active Midcap, you can compare the effects of market volatilities on Lord Abbett and Dreyfus Active 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 Lord Abbett with a short position of Dreyfus Active. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lord Abbett and Dreyfus Active.
Diversification Opportunities for Lord Abbett and Dreyfus Active
0.9 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Lord and Dreyfus is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding Lord Abbett Diversified and Dreyfus Active Midcap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dreyfus Active Midcap and Lord Abbett 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 Lord Abbett Diversified are associated (or correlated) with Dreyfus Active. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dreyfus Active Midcap has no effect on the direction of Lord Abbett i.e., Lord Abbett and Dreyfus Active go up and down completely randomly.
Pair Corralation between Lord Abbett and Dreyfus Active
Assuming the 90 days horizon Lord Abbett is expected to generate 1.57 times less return on investment than Dreyfus Active. But when comparing it to its historical volatility, Lord Abbett Diversified is 2.63 times less risky than Dreyfus Active. It trades about 0.14 of its potential returns per unit of risk. Dreyfus Active Midcap is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 6,093 in Dreyfus Active Midcap on September 3, 2024 and sell it today you would earn a total of 785.00 from holding Dreyfus Active Midcap or generate 12.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lord Abbett Diversified vs. Dreyfus Active Midcap
Performance |
| Timeline |
| Lord Abbett Diversified |
| Dreyfus Active Midcap |
Lord Abbett and Dreyfus Active Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lord Abbett and Dreyfus Active
The main advantage of trading using opposite Lord Abbett and Dreyfus Active positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lord Abbett position performs unexpectedly, Dreyfus Active 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 Active will offset losses from the drop in Dreyfus Active's long position.| Lord Abbett vs. Salient Mlp Energy | Lord Abbett vs. Fidelity Advisor Energy | Lord Abbett vs. Energy Basic Materials | Lord Abbett vs. Tortoise Energy Independence |
| Dreyfus Active vs. Huber Capital Diversified | Dreyfus Active vs. American Funds Conservative | Dreyfus Active vs. Massmutual Premier Diversified | Dreyfus Active vs. Fidelity Advisor Diversified |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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