Correlation Between Dreyfus Short and Harbor International

Can any of the company-specific risk be diversified away by investing in both Dreyfus Short and Harbor International 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 Short and Harbor International into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Dreyfus Short Intermediate and Harbor International Growth, you can compare the effects of market volatilities on Dreyfus Short and Harbor International 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 Short with a short position of Harbor International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dreyfus Short and Harbor International.

Diversification Opportunities for Dreyfus Short and Harbor International

-0.06

Correlation Coefficient

Dreyfus Short  Harbor International

Good diversification

The 3 months correlation between Dreyfus and Harbor is -0.06. Overlapping area represents the amount of risk that can be diversified away by holding Dreyfus Short Intermediate and Harbor International Growth in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Harbor International and Dreyfus Short 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 Short Intermediate are associated (or correlated) with Harbor International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Harbor International has no effect on the direction of Dreyfus Short i.e., Dreyfus Short and Harbor International go up and down completely randomly.

Pair Corralation between Dreyfus Short and Harbor International

Assuming the 90 days horizon Dreyfus Short Intermediate is expected to under-perform the Harbor International. But the mutual fund apears to be less risky and, when comparing its historical volatility, Dreyfus Short Intermediate is 9.81 times less risky than Harbor International. The mutual fund trades about -0.01 of its potential returns per unit of risk. The Harbor International Growth is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest  1,692  in Harbor International Growth on September 17, 2024 and sell it today you would earn a total of  67.00  from holding Harbor International Growth or generate 3.96% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	54.69%
Values	Daily Returns

Dreyfus Short Intermediate  vs.  Harbor International Growth

Dreyfus Short Interm

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Dreyfus Short Intermediate has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong forward indicators, Dreyfus Short is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Harbor International

Risk-Adjusted Performance

0 of 100

OK

Over the last 90 days Harbor International Growth has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly weak technical and fundamental indicators, Harbor International may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with Dreyfus Short and Harbor International

The main advantage of trading using opposite Dreyfus Short and Harbor International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dreyfus Short position performs unexpectedly, Harbor International 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 Harbor International will offset losses from the drop in Harbor International's long position.

The idea behind Dreyfus Short Intermediate and Harbor International Growth pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.