Correlation Between Western Asset and Dreyfus Government
Can any of the company-specific risk be diversified away by investing in both Western Asset and Dreyfus Government 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 Western Asset and Dreyfus Government into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Western Asset Municipal and Dreyfus Government Cash, you can compare the effects of market volatilities on Western Asset and Dreyfus Government 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 Western Asset with a short position of Dreyfus Government. Check out your portfolio center. Please also check ongoing floating volatility patterns of Western Asset and Dreyfus Government.
Diversification Opportunities for Western Asset and Dreyfus Government
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Western and Dreyfus is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Western Asset Municipal and Dreyfus Government Cash in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dreyfus Government Cash and Western Asset 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 Western Asset Municipal are associated (or correlated) with Dreyfus Government. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dreyfus Government Cash has no effect on the direction of Western Asset i.e., Western Asset and Dreyfus Government go up and down completely randomly.
Pair Corralation between Western Asset and Dreyfus Government
If you would invest 0.00 in Dreyfus Government Cash on October 21, 2024 and sell it today you would earn a total of 0.00 from holding Dreyfus Government Cash or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 5.26% |
| Values | Daily Returns |
Western Asset Municipal vs. Dreyfus Government Cash
Performance |
| Timeline |
| Western Asset Municipal |
| Dreyfus Government Cash |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Western Asset and Dreyfus Government Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Western Asset and Dreyfus Government
The main advantage of trading using opposite Western Asset and Dreyfus Government positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Western Asset position performs unexpectedly, Dreyfus Government 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 Government will offset losses from the drop in Dreyfus Government's long position.| Western Asset vs. Blrc Sgy Mnp | Western Asset vs. Metropolitan West Porate | Western Asset vs. Rbc Impact Bond | Western Asset vs. Artisan High Income |
| Dreyfus Government vs. Artisan High Income | Dreyfus Government vs. Alliancebernstein Bond | Dreyfus Government vs. Ab Bond Inflation | Dreyfus Government vs. Ab Bond Inflation |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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