Correlation Between Virtus Seix and Dreyfus Strategic
Can any of the company-specific risk be diversified away by investing in both Virtus Seix 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 Virtus Seix and Dreyfus Strategic into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Virtus Seix Government and Dreyfus Strategic Value, you can compare the effects of market volatilities on Virtus Seix 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 Virtus Seix with a short position of Dreyfus Strategic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Virtus Seix and Dreyfus Strategic.
Diversification Opportunities for Virtus Seix and Dreyfus Strategic
0.72 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Virtus and Dreyfus is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding Virtus Seix Government 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 Virtus Seix 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 Virtus Seix Government 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 Virtus Seix i.e., Virtus Seix and Dreyfus Strategic go up and down completely randomly.
Pair Corralation between Virtus Seix and Dreyfus Strategic
Assuming the 90 days horizon Virtus Seix is expected to generate 5.32 times less return on investment than Dreyfus Strategic. But when comparing it to its historical volatility, Virtus Seix Government is 7.69 times less risky than Dreyfus Strategic. It trades about 0.2 of its potential returns per unit of risk. Dreyfus Strategic Value is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest 4,432 in Dreyfus Strategic Value on September 3, 2024 and sell it today you would earn a total of 712.00 from holding Dreyfus Strategic Value or generate 16.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Virtus Seix Government vs. Dreyfus Strategic Value
Performance |
| Timeline |
| Virtus Seix Government |
| Dreyfus Strategic Value |
Virtus Seix and Dreyfus Strategic Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Virtus Seix and Dreyfus Strategic
The main advantage of trading using opposite Virtus Seix and Dreyfus Strategic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Virtus Seix 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.| Virtus Seix vs. Virtus Global Real | Virtus Seix vs. Allianzgi Mid Cap Fund | Virtus Seix vs. Virtus Select Mlp | Virtus Seix vs. Virtus Rampart Enhanced |
| Dreyfus Strategic vs. Sterling Capital Short | Dreyfus Strategic vs. Rbc Short Duration | Dreyfus Strategic vs. Angel Oak Ultrashort | Dreyfus Strategic vs. Vanguard Institutional Short Term |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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