Correlation Between Lebenthal Lisanti and Vanguard Mid
Can any of the company-specific risk be diversified away by investing in both Lebenthal Lisanti and Vanguard Mid 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 Lebenthal Lisanti and Vanguard Mid into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lebenthal Lisanti Small and Vanguard Mid Cap Index, you can compare the effects of market volatilities on Lebenthal Lisanti and Vanguard Mid 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 Lebenthal Lisanti with a short position of Vanguard Mid. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lebenthal Lisanti and Vanguard Mid.
Diversification Opportunities for Lebenthal Lisanti and Vanguard Mid
0.95 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Lebenthal and Vanguard is 0.95. Overlapping area represents the amount of risk that can be diversified away by holding Lebenthal Lisanti Small and Vanguard Mid Cap Index in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vanguard Mid Cap and Lebenthal Lisanti 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 Lebenthal Lisanti Small are associated (or correlated) with Vanguard Mid. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vanguard Mid Cap has no effect on the direction of Lebenthal Lisanti i.e., Lebenthal Lisanti and Vanguard Mid go up and down completely randomly.
Pair Corralation between Lebenthal Lisanti and Vanguard Mid
Assuming the 90 days horizon Lebenthal Lisanti Small is expected to generate 1.9 times more return on investment than Vanguard Mid. However, Lebenthal Lisanti is 1.9 times more volatile than Vanguard Mid Cap Index. It trades about 0.14 of its potential returns per unit of risk. Vanguard Mid Cap Index is currently generating about 0.16 per unit of risk. If you would invest 1,973 in Lebenthal Lisanti Small on September 15, 2024 and sell it today you would earn a total of 237.00 from holding Lebenthal Lisanti Small or generate 12.01% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Strong |
Accuracy | 100.0% |
Values | Daily Returns |
Lebenthal Lisanti Small vs. Vanguard Mid Cap Index
Performance |
Timeline |
Lebenthal Lisanti Small |
Vanguard Mid Cap |
Lebenthal Lisanti and Vanguard Mid Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Lebenthal Lisanti and Vanguard Mid
The main advantage of trading using opposite Lebenthal Lisanti and Vanguard Mid positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lebenthal Lisanti position performs unexpectedly, Vanguard Mid 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 Vanguard Mid will offset losses from the drop in Vanguard Mid's long position.Lebenthal Lisanti vs. Lord Abbett Growth | Lebenthal Lisanti vs. Queens Road Small | Lebenthal Lisanti vs. Eaton Vance Large Cap | Lebenthal Lisanti vs. Aquagold International |
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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 CEOs Directory module to screen CEOs from public companies around the world.
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