Correlation Between Loomis Sayles and Tiaa Cref

Can any of the company-specific risk be diversified away by investing in both Loomis Sayles and Tiaa Cref 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 Loomis Sayles and Tiaa Cref into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Loomis Sayles Investment and Tiaa Cref Small Cap Blend, you can compare the effects of market volatilities on Loomis Sayles and Tiaa Cref 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 Loomis Sayles with a short position of Tiaa Cref. Check out your portfolio center. Please also check ongoing floating volatility patterns of Loomis Sayles and Tiaa Cref.

Diversification Opportunities for Loomis Sayles and Tiaa Cref

0.28

Correlation Coefficient

Loomis Sayles  Tiaa Cref

Modest diversification

The 3 months correlation between Loomis and Tiaa is 0.28. Overlapping area represents the amount of risk that can be diversified away by holding Loomis Sayles Investment and Tiaa Cref Small Cap Blend in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tiaa Cref Small and Loomis Sayles 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 Loomis Sayles Investment are associated (or correlated) with Tiaa Cref. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tiaa Cref Small has no effect on the direction of Loomis Sayles i.e., Loomis Sayles and Tiaa Cref go up and down completely randomly.

Pair Corralation between Loomis Sayles and Tiaa Cref

Assuming the 90 days horizon Loomis Sayles Investment is expected to generate 0.23 times more return on investment than Tiaa Cref. However, Loomis Sayles Investment is 4.33 times less risky than Tiaa Cref. It trades about 0.03 of its potential returns per unit of risk. Tiaa Cref Small Cap Blend is currently generating about -0.21 per unit of risk. If you would invest  982.00  in Loomis Sayles Investment on December 2, 2024 and sell it today you would earn a total of  4.00  from holding Loomis Sayles Investment or generate 0.41% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Loomis Sayles Investment  vs.  Tiaa Cref Small Cap Blend

Loomis Sayles Investment

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Loomis Sayles Investment are ranked lower than 1 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, Loomis Sayles is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Tiaa Cref Small

Risk-Adjusted Performance

Very Weak

Over the last 90 days Tiaa Cref Small Cap Blend has generated negative risk-adjusted returns adding no value to fund investors. In spite of weak performance in the last few months, the Fund's fundamental drivers remain fairly strong which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long term up-swing for the fund investors.

Pair Trading with Loomis Sayles and Tiaa Cref

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

The idea behind Loomis Sayles Investment and Tiaa Cref Small Cap Blend 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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.