Correlation Between Lazard Capital and Arbitrage Event
Can any of the company-specific risk be diversified away by investing in both Lazard Capital and Arbitrage Event 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 Lazard Capital and Arbitrage Event into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lazard Capital Allocator and The Arbitrage Event Driven, you can compare the effects of market volatilities on Lazard Capital and Arbitrage Event 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 Lazard Capital with a short position of Arbitrage Event. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lazard Capital and Arbitrage Event.
Diversification Opportunities for Lazard Capital and Arbitrage Event
0.1 | Correlation Coefficient |
Average diversification
The 3 months correlation between Lazard and Arbitrage is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding Lazard Capital Allocator and The Arbitrage Event Driven in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Arbitrage Event and Lazard Capital 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 Lazard Capital Allocator are associated (or correlated) with Arbitrage Event. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Arbitrage Event has no effect on the direction of Lazard Capital i.e., Lazard Capital and Arbitrage Event go up and down completely randomly.
Pair Corralation between Lazard Capital and Arbitrage Event
Assuming the 90 days horizon Lazard Capital Allocator is expected to generate 2.71 times more return on investment than Arbitrage Event. However, Lazard Capital is 2.71 times more volatile than The Arbitrage Event Driven. It trades about 0.23 of its potential returns per unit of risk. The Arbitrage Event Driven is currently generating about 0.02 per unit of risk. If you would invest 1,049 in Lazard Capital Allocator on September 7, 2024 and sell it today you would earn a total of 93.00 from holding Lazard Capital Allocator or generate 8.87% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Lazard Capital Allocator vs. The Arbitrage Event Driven
Performance |
Timeline |
Lazard Capital Allocator |
Arbitrage Event |
Lazard Capital and Arbitrage Event Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Lazard Capital and Arbitrage Event
The main advantage of trading using opposite Lazard Capital and Arbitrage Event positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lazard Capital position performs unexpectedly, Arbitrage Event 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 Arbitrage Event will offset losses from the drop in Arbitrage Event's long position.Lazard Capital vs. Inverse Government Long | Lazard Capital vs. Virtus Seix Government | Lazard Capital vs. Prudential Government Income | Lazard Capital vs. Short Term Government Fund |
Arbitrage Event vs. Aqr Diversified Arbitrage | Arbitrage Event vs. Baron Emerging Markets | Arbitrage Event vs. The Arbitrage Fund | Arbitrage Event vs. Brandes Emerging Markets |
Check out your portfolio center.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 Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
Other Complementary Tools
My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA | |
Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments | |
Volatility Analysis Get historical volatility and risk analysis based on latest market data |