Correlation Between Harding Loevner and Loomis Sayles

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

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

Diversification Opportunities for Harding Loevner and Loomis Sayles

-0.47

Correlation Coefficient

Harding Loevner  Loomis Sayles

Very good diversification

The 3 months correlation between Harding and Loomis is -0.47. Overlapping area represents the amount of risk that can be diversified away by holding Harding Loevner International and Loomis Sayles Growth in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Loomis Sayles Growth and Harding Loevner 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 Harding Loevner International are associated (or correlated) with Loomis Sayles. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Loomis Sayles Growth has no effect on the direction of Harding Loevner i.e., Harding Loevner and Loomis Sayles go up and down completely randomly.

Pair Corralation between Harding Loevner and Loomis Sayles

Assuming the 90 days horizon Harding Loevner International is expected to under-perform the Loomis Sayles. But the mutual fund apears to be less risky and, when comparing its historical volatility, Harding Loevner International is 1.24 times less risky than Loomis Sayles. The mutual fund trades about -0.08 of its potential returns per unit of risk. The Loomis Sayles Growth is currently generating about 0.17 of returns per unit of risk over similar time horizon. If you would invest  2,747  in Loomis Sayles Growth on August 30, 2024 and sell it today you would earn a total of  322.00  from holding Loomis Sayles Growth or generate 11.72% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Harding Loevner International  vs.  Loomis Sayles Growth

Harding Loevner Inte

Risk-Adjusted Performance

0 of 100

Very Weak

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

Loomis Sayles Growth

Risk-Adjusted Performance

13 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Loomis Sayles Growth are ranked lower than 13 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak basic indicators, Loomis Sayles may actually be approaching a critical reversion point that can send shares even higher in December 2024.

Pair Trading with Harding Loevner and Loomis Sayles

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

The idea behind Harding Loevner International and Loomis Sayles Growth 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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.