Correlation Between Dreyfus Strategic and Sterling Capital
Can any of the company-specific risk be diversified away by investing in both Dreyfus Strategic and Sterling Capital 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 Dreyfus Strategic and Sterling Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dreyfus Strategic Municipal and Sterling Capital Ultra, you can compare the effects of market volatilities on Dreyfus Strategic and Sterling Capital 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 Dreyfus Strategic with a short position of Sterling Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dreyfus Strategic and Sterling Capital.
Diversification Opportunities for Dreyfus Strategic and Sterling Capital
-0.42 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Dreyfus and Sterling is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding Dreyfus Strategic Municipal and Sterling Capital Ultra in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sterling Capital Ultra and Dreyfus Strategic 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 Dreyfus Strategic Municipal are associated (or correlated) with Sterling Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sterling Capital Ultra has no effect on the direction of Dreyfus Strategic i.e., Dreyfus Strategic and Sterling Capital go up and down completely randomly.
Pair Corralation between Dreyfus Strategic and Sterling Capital
Assuming the 90 days horizon Dreyfus Strategic Municipal is expected to generate 5.95 times more return on investment than Sterling Capital. However, Dreyfus Strategic is 5.95 times more volatile than Sterling Capital Ultra. It trades about 0.06 of its potential returns per unit of risk. Sterling Capital Ultra is currently generating about 0.22 per unit of risk. If you would invest 666.00 in Dreyfus Strategic Municipal on November 27, 2024 and sell it today you would earn a total of 3.00 from holding Dreyfus Strategic Municipal or generate 0.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dreyfus Strategic Municipal vs. Sterling Capital Ultra
Performance |
| Timeline |
| Dreyfus Strategic |
| Sterling Capital Ultra |
Dreyfus Strategic and Sterling Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dreyfus Strategic and Sterling Capital
The main advantage of trading using opposite Dreyfus Strategic and Sterling Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dreyfus Strategic position performs unexpectedly, Sterling Capital 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 Sterling Capital will offset losses from the drop in Sterling Capital's long position.| Dreyfus Strategic vs. Ashmore Emerging Markets | Dreyfus Strategic vs. T Rowe Price | Dreyfus Strategic vs. T Rowe Price | Dreyfus Strategic vs. Allianzgi Small Cap Blend |
| Sterling Capital vs. Lord Abbett Vertible | Sterling Capital vs. Gabelli Convertible And | Sterling Capital vs. Harbor Vertible Securities | Sterling Capital vs. The Gamco Global |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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