Correlation Between Aggressive Balanced and Dreyfus Strategic
Can any of the company-specific risk be diversified away by investing in both Aggressive Balanced and Dreyfus Strategic 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 Aggressive Balanced and Dreyfus Strategic into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aggressive Balanced Allocation and Dreyfus Strategic Value, you can compare the effects of market volatilities on Aggressive Balanced and Dreyfus Strategic 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 Aggressive Balanced with a short position of Dreyfus Strategic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aggressive Balanced and Dreyfus Strategic.
Diversification Opportunities for Aggressive Balanced and Dreyfus Strategic
0.53 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Aggressive and Dreyfus is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding Aggressive Balanced Allocation and Dreyfus Strategic Value in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dreyfus Strategic Value and Aggressive Balanced 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 Aggressive Balanced Allocation are associated (or correlated) with Dreyfus Strategic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dreyfus Strategic Value has no effect on the direction of Aggressive Balanced i.e., Aggressive Balanced and Dreyfus Strategic go up and down completely randomly.
Pair Corralation between Aggressive Balanced and Dreyfus Strategic
Assuming the 90 days horizon Aggressive Balanced Allocation is expected to generate 0.74 times more return on investment than Dreyfus Strategic. However, Aggressive Balanced Allocation is 1.35 times less risky than Dreyfus Strategic. It trades about 0.07 of its potential returns per unit of risk. Dreyfus Strategic Value is currently generating about 0.05 per unit of risk. If you would invest 1,002 in Aggressive Balanced Allocation on October 25, 2024 and sell it today you would earn a total of 217.00 from holding Aggressive Balanced Allocation or generate 21.66% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aggressive Balanced Allocation vs. Dreyfus Strategic Value
Performance |
| Timeline |
| Aggressive Balanced |
| Dreyfus Strategic Value |
Aggressive Balanced and Dreyfus Strategic Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aggressive Balanced and Dreyfus Strategic
The main advantage of trading using opposite Aggressive Balanced and Dreyfus Strategic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aggressive Balanced position performs unexpectedly, Dreyfus Strategic 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 Strategic will offset losses from the drop in Dreyfus Strategic's long position.| Aggressive Balanced vs. Locorr Market Trend | Aggressive Balanced vs. Saat Market Growth | Aggressive Balanced vs. Ashmore Emerging Markets | Aggressive Balanced vs. Lord Abbett Diversified |
| Dreyfus Strategic vs. Voya Government Money | Dreyfus Strategic vs. Sit Government Securities | Dreyfus Strategic vs. Franklin Adjustable Government | Dreyfus Strategic vs. Payden Government Fund |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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