Correlation Between Intel and The Dreyfus

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

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

Diversification Opportunities for Intel and The Dreyfus

0.84

Correlation Coefficient

Intel  The Dreyfus

Very poor diversification

The 3 months correlation between Intel and The is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding Intel and The Dreyfus Sustainable in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on The Dreyfus Sustainable and Intel 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 Intel are associated (or correlated) with The Dreyfus. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of The Dreyfus Sustainable has no effect on the direction of Intel i.e., Intel and The Dreyfus go up and down completely randomly.

Pair Corralation between Intel and The Dreyfus

Given the investment horizon of 90 days Intel is expected to under-perform the The Dreyfus. In addition to that, Intel is 3.25 times more volatile than The Dreyfus Sustainable. It trades about -0.06 of its total potential returns per unit of risk. The Dreyfus Sustainable is currently generating about 0.06 per unit of volatility. If you would invest  1,252  in The Dreyfus Sustainable on November 20, 2024 and sell it today you would earn a total of  222.00  from holding The Dreyfus Sustainable or generate 17.73% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Strong
Accuracy	100.0%
Values	Daily Returns

Intel  vs.  The Dreyfus Sustainable

Intel

Risk-Adjusted Performance

Very Weak

Over the last 90 days Intel has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound basic indicators, Intel is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.

The Dreyfus Sustainable

Risk-Adjusted Performance

Very Weak

Over the last 90 days The Dreyfus Sustainable has generated negative risk-adjusted returns adding no value to fund investors. In spite of latest weak performance, the Fund's fundamental indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the fund investors.

Pair Trading with Intel and The Dreyfus

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

The idea behind Intel and The Dreyfus Sustainable 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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.