Correlation Between Vy(r) Franklin and Lord Abbett

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

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

Diversification Opportunities for Vy(r) Franklin and Lord Abbett

0.42

Correlation Coefficient

Vy(r) Franklin  Lord Abbett

Very weak diversification

The 3 months correlation between Vy(r) and Lord is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding Vy Franklin Income and Lord Abbett Floating in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lord Abbett Floating and Vy(r) Franklin 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 Vy Franklin Income 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 Floating has no effect on the direction of Vy(r) Franklin i.e., Vy(r) Franklin and Lord Abbett go up and down completely randomly.

Pair Corralation between Vy(r) Franklin and Lord Abbett

If you would invest  651.00  in Lord Abbett Floating on October 25, 2024 and sell it today you would earn a total of  168.00  from holding Lord Abbett Floating or generate 25.81% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	0.0%
Values	Daily Returns

Vy Franklin Income  vs.  Lord Abbett Floating

Vy Franklin Income

Risk-Adjusted Performance

0 of 100

OK

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

Lord Abbett Floating

Risk-Adjusted Performance

17 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Lord Abbett Floating are ranked lower than 17 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, Lord Abbett is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Vy(r) Franklin and Lord Abbett

The main advantage of trading using opposite Vy(r) Franklin and Lord Abbett positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Vy(r) Franklin 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 Vy Franklin Income and Lord Abbett Floating 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 Transaction History module to view history of all your transactions and understand their impact on performance.