Correlation Between L Abbett and Lazard Us
Can any of the company-specific risk be diversified away by investing in both L Abbett and Lazard Us 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 Lazard Us 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 Lazard Strategic Equity, you can compare the effects of market volatilities on L Abbett and Lazard Us 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 Lazard Us. Check out your portfolio center. Please also check ongoing floating volatility patterns of L Abbett and Lazard Us.
Diversification Opportunities for L Abbett and Lazard Us
Very poor diversification
The 3 months correlation between LGLSX and Lazard is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding L Abbett Growth and Lazard Strategic Equity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lazard Strategic Equity 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 Lazard Us. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lazard Strategic Equity has no effect on the direction of L Abbett i.e., L Abbett and Lazard Us go up and down completely randomly.
Pair Corralation between L Abbett and Lazard Us
Assuming the 90 days horizon L Abbett Growth is expected to generate 1.52 times more return on investment than Lazard Us. However, L Abbett is 1.52 times more volatile than Lazard Strategic Equity. It trades about 0.35 of its potential returns per unit of risk. Lazard Strategic Equity is currently generating about 0.11 per unit of risk. If you would invest 3,936 in L Abbett Growth on September 11, 2024 and sell it today you would earn a total of 1,046 from holding L Abbett Growth or generate 26.58% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Strong |
Accuracy | 100.0% |
Values | Daily Returns |
L Abbett Growth vs. Lazard Strategic Equity
Performance |
Timeline |
L Abbett Growth |
Lazard Strategic Equity |
L Abbett and Lazard Us Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with L Abbett and Lazard Us
The main advantage of trading using opposite L Abbett and Lazard Us positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if L Abbett position performs unexpectedly, Lazard Us 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 Lazard Us will offset losses from the drop in Lazard Us' long position.L Abbett vs. Lord Abbett Trust | L Abbett vs. Lord Abbett Trust | L Abbett vs. Lord Abbett Focused | L Abbett vs. Floating Rate Fund |
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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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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