Correlation Between Dreyfus High and Dreyfus Gnma
Can any of the company-specific risk be diversified away by investing in both Dreyfus High and Dreyfus Gnma 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 High and Dreyfus Gnma into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dreyfus High Yield and Dreyfus Gnma Fund, you can compare the effects of market volatilities on Dreyfus High and Dreyfus Gnma 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 High with a short position of Dreyfus Gnma. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dreyfus High and Dreyfus Gnma.
Diversification Opportunities for Dreyfus High and Dreyfus Gnma
0.6 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Dreyfus and Dreyfus is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding Dreyfus High Yield and Dreyfus Gnma Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dreyfus Gnma and Dreyfus High 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 High Yield are associated (or correlated) with Dreyfus Gnma. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dreyfus Gnma has no effect on the direction of Dreyfus High i.e., Dreyfus High and Dreyfus Gnma go up and down completely randomly.
Pair Corralation between Dreyfus High and Dreyfus Gnma
Assuming the 90 days horizon Dreyfus High Yield is expected to under-perform the Dreyfus Gnma. In addition to that, Dreyfus High is 1.48 times more volatile than Dreyfus Gnma Fund. It trades about -0.3 of its total potential returns per unit of risk. Dreyfus Gnma Fund is currently generating about -0.25 per unit of volatility. If you would invest 1,272 in Dreyfus Gnma Fund on September 25, 2024 and sell it today you would lose (17.00) from holding Dreyfus Gnma Fund or give up 1.34% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 95.24% |
Values | Daily Returns |
Dreyfus High Yield vs. Dreyfus Gnma Fund
Performance |
Timeline |
Dreyfus High Yield |
Dreyfus Gnma |
Dreyfus High and Dreyfus Gnma Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Dreyfus High and Dreyfus Gnma
The main advantage of trading using opposite Dreyfus High and Dreyfus Gnma positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dreyfus High position performs unexpectedly, Dreyfus Gnma 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 Gnma will offset losses from the drop in Dreyfus Gnma's long position.Dreyfus High vs. Dreyfusstandish Global Fixed | Dreyfus High vs. Dreyfusstandish Global Fixed | Dreyfus High vs. Dreyfus High Yield | Dreyfus High vs. Dreyfus High Yield |
Dreyfus Gnma vs. Dreyfusstandish Global Fixed | Dreyfus Gnma vs. Dreyfusstandish Global Fixed | Dreyfus Gnma vs. Dreyfus High Yield | Dreyfus Gnma vs. Dreyfus High Yield |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
Other Complementary Tools
Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes | |
Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas |