Correlation Between Amg Managers and Dreyfus Municipal
Can any of the company-specific risk be diversified away by investing in both Amg Managers and Dreyfus Municipal 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 Amg Managers and Dreyfus Municipal into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Amg Managers Centersquare and Dreyfus Municipal Bond, you can compare the effects of market volatilities on Amg Managers and Dreyfus Municipal 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 Amg Managers with a short position of Dreyfus Municipal. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amg Managers and Dreyfus Municipal.
Diversification Opportunities for Amg Managers and Dreyfus Municipal
0.6 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Amg and Dreyfus is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding Amg Managers Centersquare and Dreyfus Municipal Bond in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dreyfus Municipal Bond and Amg Managers 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 Amg Managers Centersquare are associated (or correlated) with Dreyfus Municipal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dreyfus Municipal Bond has no effect on the direction of Amg Managers i.e., Amg Managers and Dreyfus Municipal go up and down completely randomly.
Pair Corralation between Amg Managers and Dreyfus Municipal
Assuming the 90 days horizon Amg Managers Centersquare is expected to under-perform the Dreyfus Municipal. In addition to that, Amg Managers is 4.78 times more volatile than Dreyfus Municipal Bond. It trades about -0.25 of its total potential returns per unit of risk. Dreyfus Municipal Bond is currently generating about -0.36 per unit of volatility. If you would invest 1,235 in Dreyfus Municipal Bond on October 9, 2024 and sell it today you would lose (22.00) from holding Dreyfus Municipal Bond or give up 1.78% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Amg Managers Centersquare vs. Dreyfus Municipal Bond
Performance |
| Timeline |
| Amg Managers Centersquare |
| Dreyfus Municipal Bond |
Amg Managers and Dreyfus Municipal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Amg Managers and Dreyfus Municipal
The main advantage of trading using opposite Amg Managers and Dreyfus Municipal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amg Managers position performs unexpectedly, Dreyfus Municipal 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 Municipal will offset losses from the drop in Dreyfus Municipal's long position.| Amg Managers vs. Wilmington Diversified Income | Amg Managers vs. Stone Ridge Diversified | Amg Managers vs. Lord Abbett Diversified | Amg Managers vs. Manning Napier Diversified |
| Dreyfus Municipal vs. Dreyfusstandish Global Fixed | Dreyfus Municipal vs. Dreyfusstandish Global Fixed | Dreyfus Municipal vs. Dreyfus High Yield | Dreyfus Municipal 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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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