Correlation Between L Abbett and Voya Balanced

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

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

Diversification Opportunities for L Abbett and Voya Balanced

-0.03

Correlation Coefficient

L Abbett  Voya Balanced

Good diversification

The 3 months correlation between LGLSX and Voya is -0.03. Overlapping area represents the amount of risk that can be diversified away by holding L Abbett Growth and Voya Balanced Portfolio in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Voya Balanced Portfolio and L 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 L Abbett Growth are associated (or correlated) with Voya Balanced. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Voya Balanced Portfolio has no effect on the direction of L Abbett i.e., L Abbett and Voya Balanced go up and down completely randomly.

Pair Corralation between L Abbett and Voya Balanced

If you would invest  4,332  in L Abbett Growth on October 25, 2024 and sell it today you would earn a total of  725.00  from holding L Abbett Growth or generate 16.74% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	1.69%
Values	Daily Returns

L Abbett Growth  vs.  Voya Balanced Portfolio

L Abbett Growth

Risk-Adjusted Performance

14 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in L Abbett Growth are ranked lower than 14 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak basic indicators, L Abbett showed solid returns over the last few months and may actually be approaching a breakup point.

Voya Balanced Portfolio

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with L Abbett and Voya Balanced

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

The idea behind L Abbett Growth and Voya Balanced Portfolio 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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.