Correlation Between Lord Abbett and Aqr Equity

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

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

Diversification Opportunities for Lord Abbett and Aqr Equity

0.0

Correlation Coefficient

Lord Abbett  Aqr Equity

Pay attention - limited upside

The 3 months correlation between Lord and Aqr is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Lord Abbett Government and Aqr Equity Market in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aqr Equity Market and Lord Abbett 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 Lord Abbett Government are associated (or correlated) with Aqr Equity. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aqr Equity Market has no effect on the direction of Lord Abbett i.e., Lord Abbett and Aqr Equity go up and down completely randomly.

Pair Corralation between Lord Abbett and Aqr Equity

If you would invest  1,008  in Aqr Equity Market on October 25, 2024 and sell it today you would earn a total of  22.00  from holding Aqr Equity Market or generate 2.18% return on investment over 90 days.

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

Lord Abbett Government  vs.  Aqr Equity Market

Lord Abbett Government

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Lord Abbett Government has generated negative risk-adjusted returns adding no value to fund investors. 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.

Aqr Equity Market

Risk-Adjusted Performance

30 of 100

Strong

Compared to the overall equity markets, risk-adjusted returns on investments in Aqr Equity Market are ranked lower than 30 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak basic indicators, Aqr Equity may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Pair Trading with Lord Abbett and Aqr Equity

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

The idea behind Lord Abbett Government and Aqr Equity Market 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.

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 Dashboard module to portfolio dashboard that provides centralized access to all your investments.