Correlation Between Dreyfus Municipal and Fidelity California
Can any of the company-specific risk be diversified away by investing in both Dreyfus Municipal and Fidelity California 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 Municipal and Fidelity California into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dreyfus Municipal Bond and Fidelity California Municipal, you can compare the effects of market volatilities on Dreyfus Municipal and Fidelity California 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 Municipal with a short position of Fidelity California. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dreyfus Municipal and Fidelity California.
Diversification Opportunities for Dreyfus Municipal and Fidelity California
1.0 | Correlation Coefficient |
No risk reduction
The 3 months correlation between Dreyfus and Fidelity is 1.0. Overlapping area represents the amount of risk that can be diversified away by holding Dreyfus Municipal Bond and Fidelity California Municipal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fidelity California and Dreyfus Municipal 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 Municipal Bond are associated (or correlated) with Fidelity California. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fidelity California has no effect on the direction of Dreyfus Municipal i.e., Dreyfus Municipal and Fidelity California go up and down completely randomly.
Pair Corralation between Dreyfus Municipal and Fidelity California
Assuming the 90 days horizon Dreyfus Municipal Bond is expected to generate 1.81 times more return on investment than Fidelity California. However, Dreyfus Municipal is 1.81 times more volatile than Fidelity California Municipal. It trades about 0.42 of its potential returns per unit of risk. Fidelity California Municipal is currently generating about 0.42 per unit of risk. If you would invest 1,092 in Dreyfus Municipal Bond on August 21, 2025 and sell it today you would earn a total of 90.00 from holding Dreyfus Municipal Bond or generate 8.24% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dreyfus Municipal Bond vs. Fidelity California Municipal
Performance |
| Timeline |
| Dreyfus Municipal Bond |
| Fidelity California |
Dreyfus Municipal and Fidelity California Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dreyfus Municipal and Fidelity California
The main advantage of trading using opposite Dreyfus Municipal and Fidelity California positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dreyfus Municipal position performs unexpectedly, Fidelity California 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 Fidelity California will offset losses from the drop in Fidelity California's long position.| Dreyfus Municipal vs. Vanguard Total Stock | Dreyfus Municipal vs. Vanguard 500 Index | Dreyfus Municipal vs. Vanguard Total Stock | Dreyfus Municipal vs. Vanguard Total Stock |
| Fidelity California vs. Fidelity Freedom 2015 | Fidelity California vs. Fidelity Puritan Fund | Fidelity California vs. Fidelity Puritan Fund | Fidelity California vs. Fidelity Pennsylvania Municipal |
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
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. |