Correlation Between Ethereum and Lord Abbett

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

By analyzing existing cross correlation between Ethereum and Lord Abbett International, you can compare the effects of market volatilities on Ethereum and Lord Abbett 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 Ethereum with a short position of Lord Abbett. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ethereum and Lord Abbett.

Diversification Opportunities for Ethereum and Lord Abbett

-0.7

Correlation Coefficient

Ethereum  Lord Abbett

Excellent diversification

The 3 months correlation between Ethereum and Lord is -0.7. Overlapping area represents the amount of risk that can be diversified away by holding Ethereum and Lord Abbett International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lord Abbett International and Ethereum 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 Ethereum are associated (or correlated) with Lord Abbett. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lord Abbett International has no effect on the direction of Ethereum i.e., Ethereum and Lord Abbett go up and down completely randomly.

Pair Corralation between Ethereum and Lord Abbett

Assuming the 90 days trading horizon Ethereum is expected to under-perform the Lord Abbett. In addition to that, Ethereum is 4.95 times more volatile than Lord Abbett International. It trades about -0.16 of its total potential returns per unit of risk. Lord Abbett International is currently generating about 0.28 per unit of volatility. If you would invest  781.00  in Lord Abbett International on December 20, 2024 and sell it today you would earn a total of  114.00  from holding Lord Abbett International or generate 14.6% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	93.75%
Values	Daily Returns

Ethereum  vs.  Lord Abbett International

Ethereum

Risk-Adjusted Performance

Very Weak

Over the last 90 days Ethereum has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unsteady performance in the last few months, the Crypto's technical indicators remain rather sound which may send shares a bit higher in April 2025. The latest tumult may also be a sign of longer-term up-swing for Ethereum shareholders.

Lord Abbett International

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Lord Abbett International are ranked lower than 22 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak basic indicators, Lord Abbett showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Ethereum and Lord Abbett

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

The idea behind Ethereum and Lord Abbett International 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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.