Correlation Between Value Fund and Lazard Global

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

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

Diversification Opportunities for Value Fund and Lazard Global

0.09

Correlation Coefficient

Value Fund  Lazard Global

Significant diversification

The 3 months correlation between Value and Lazard is 0.09. Overlapping area represents the amount of risk that can be diversified away by holding The Value Fund and Lazard Global Listed in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lazard Global Listed and Value Fund 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 The Value Fund are associated (or correlated) with Lazard Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lazard Global Listed has no effect on the direction of Value Fund i.e., Value Fund and Lazard Global go up and down completely randomly.

Pair Corralation between Value Fund and Lazard Global

Assuming the 90 days horizon The Value Fund is expected to under-perform the Lazard Global. In addition to that, Value Fund is 3.0 times more volatile than Lazard Global Listed. It trades about -0.24 of its total potential returns per unit of risk. Lazard Global Listed is currently generating about -0.02 per unit of volatility. If you would invest  1,596  in Lazard Global Listed on September 17, 2024 and sell it today you would lose (3.00) from holding Lazard Global Listed or give up 0.19% of portfolio value over 90 days.

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

The Value Fund  vs.  Lazard Global Listed

Value Fund

Risk-Adjusted Performance

0 of 100

Very Weak

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

Lazard Global Listed

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with Value Fund and Lazard Global

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

The idea behind The Value Fund and Lazard Global Listed 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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.