Correlation Between Dreyfus Strategic and Oakhurst Strategic
Can any of the company-specific risk be diversified away by investing in both Dreyfus Strategic and Oakhurst 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 Dreyfus Strategic and Oakhurst Strategic 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 Oakhurst Strategic Defined, you can compare the effects of market volatilities on Dreyfus Strategic and Oakhurst 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 Dreyfus Strategic with a short position of Oakhurst Strategic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dreyfus Strategic and Oakhurst Strategic.
Diversification Opportunities for Dreyfus Strategic and Oakhurst Strategic
-0.33 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Dreyfus and Oakhurst is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding Dreyfus Strategic Municipal and Oakhurst Strategic Defined in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Oakhurst Strategic 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 Oakhurst Strategic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Oakhurst Strategic has no effect on the direction of Dreyfus Strategic i.e., Dreyfus Strategic and Oakhurst Strategic go up and down completely randomly.
Pair Corralation between Dreyfus Strategic and Oakhurst Strategic
Assuming the 90 days horizon Dreyfus Strategic is expected to generate 3.89 times less return on investment than Oakhurst Strategic. But when comparing it to its historical volatility, Dreyfus Strategic Municipal is 1.09 times less risky than Oakhurst Strategic. It trades about 0.06 of its potential returns per unit of risk. Oakhurst Strategic Defined is currently generating about 0.21 of returns per unit of risk over similar time horizon. If you would invest 1,241 in Oakhurst Strategic Defined on September 3, 2024 and sell it today you would earn a total of 90.00 from holding Oakhurst Strategic Defined or generate 7.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dreyfus Strategic Municipal vs. Oakhurst Strategic Defined
Performance |
| Timeline |
| Dreyfus Strategic |
| Oakhurst Strategic |
Dreyfus Strategic and Oakhurst Strategic Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dreyfus Strategic and Oakhurst Strategic
The main advantage of trading using opposite Dreyfus Strategic and Oakhurst Strategic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dreyfus Strategic position performs unexpectedly, Oakhurst 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 Oakhurst Strategic will offset losses from the drop in Oakhurst Strategic's long position.| Dreyfus Strategic vs. Vanguard Total Stock | Dreyfus Strategic vs. Vanguard 500 Index | Dreyfus Strategic vs. Vanguard Total Stock | Dreyfus Strategic vs. Vanguard Total Stock |
| Oakhurst Strategic vs. Limited Term Tax | Oakhurst Strategic vs. T Rowe Price | Oakhurst Strategic vs. Transamerica Funds | Oakhurst Strategic vs. T Rowe Price |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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