Correlation Between Alliancebernstein and Dreyfus/standish

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

By analyzing existing cross correlation between Alliancebernstein Global Highome and Dreyfusstandish Global Fixed, you can compare the effects of market volatilities on Alliancebernstein and Dreyfus/standish 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 Alliancebernstein with a short position of Dreyfus/standish. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alliancebernstein and Dreyfus/standish.

Diversification Opportunities for Alliancebernstein and Dreyfus/standish

0.3

Correlation Coefficient

Alliancebernstein  Dreyfus/standish

Weak diversification

The 3 months correlation between Alliancebernstein and Dreyfus/standish is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding Alliancebernstein Global Higho and Dreyfusstandish Global Fixed in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dreyfusstandish Global and Alliancebernstein 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 Alliancebernstein Global Highome are associated (or correlated) with Dreyfus/standish. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dreyfusstandish Global has no effect on the direction of Alliancebernstein i.e., Alliancebernstein and Dreyfus/standish go up and down completely randomly.

Pair Corralation between Alliancebernstein and Dreyfus/standish

Assuming the 90 days horizon Alliancebernstein Global Highome is expected to under-perform the Dreyfus/standish. But the mutual fund apears to be less risky and, when comparing its historical volatility, Alliancebernstein Global Highome is 1.03 times less risky than Dreyfus/standish. The mutual fund trades about -0.07 of its potential returns per unit of risk. The Dreyfusstandish Global Fixed is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest  2,011  in Dreyfusstandish Global Fixed on December 30, 2024 and sell it today you would earn a total of  14.00  from holding Dreyfusstandish Global Fixed or generate 0.7% return on investment over 90 days.

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

Alliancebernstein Global Higho  vs.  Dreyfusstandish Global Fixed

Alliancebernstein

Risk-Adjusted Performance

Very Weak

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

Dreyfusstandish Global

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Dreyfusstandish Global Fixed are ranked lower than 3 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong forward indicators, Dreyfus/standish is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Alliancebernstein and Dreyfus/standish

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

The idea behind Alliancebernstein Global Highome and Dreyfusstandish Global Fixed 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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.