Correlation Between Lebenthal Lisanti and Voya T

Can any of the company-specific risk be diversified away by investing in both Lebenthal Lisanti and Voya T 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 Voya T 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 Voya T Rowe, you can compare the effects of market volatilities on Lebenthal Lisanti and Voya T 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 Voya T. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lebenthal Lisanti and Voya T.

Diversification Opportunities for Lebenthal Lisanti and Voya T

0.96

Correlation Coefficient

Lebenthal Lisanti  Voya T

Almost no diversification

The 3 months correlation between Lebenthal and Voya is 0.96. Overlapping area represents the amount of risk that can be diversified away by holding Lebenthal Lisanti Small and Voya T Rowe in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Voya T Rowe 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 Voya T. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Voya T Rowe has no effect on the direction of Lebenthal Lisanti i.e., Lebenthal Lisanti and Voya T go up and down completely randomly.

Pair Corralation between Lebenthal Lisanti and Voya T

Assuming the 90 days horizon Lebenthal Lisanti Small is expected to generate 2.64 times more return on investment than Voya T. However, Lebenthal Lisanti is 2.64 times more volatile than Voya T Rowe. It trades about 0.06 of its potential returns per unit of risk. Voya T Rowe is currently generating about 0.13 per unit of risk. If you would invest  1,591  in Lebenthal Lisanti Small on September 12, 2024 and sell it today you would earn a total of  630.00  from holding Lebenthal Lisanti Small or generate 39.6% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Strong
Accuracy	99.8%
Values	Daily Returns

Lebenthal Lisanti Small  vs.  Voya T Rowe

Lebenthal Lisanti Small

Risk-Adjusted Performance

13 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Lebenthal Lisanti Small are ranked lower than 13 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak technical and fundamental indicators, Lebenthal Lisanti showed solid returns over the last few months and may actually be approaching a breakup point.

Voya T Rowe

Risk-Adjusted Performance

11 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Voya T Rowe are ranked lower than 11 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, Voya T is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Lebenthal Lisanti and Voya T

The main advantage of trading using opposite Lebenthal Lisanti and Voya T positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lebenthal Lisanti position performs unexpectedly, Voya T 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 Voya T will offset losses from the drop in Voya T's long position.

The idea behind Lebenthal Lisanti Small and Voya T Rowe 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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.