Correlation Between Loomis Sayles and Ultrainternational

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

By analyzing existing cross correlation between Loomis Sayles Inflation and Ultrainternational Profund Ultrainternational, you can compare the effects of market volatilities on Loomis Sayles and Ultrainternational 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 Ultrainternational. Check out your portfolio center. Please also check ongoing floating volatility patterns of Loomis Sayles and Ultrainternational.

Diversification Opportunities for Loomis Sayles and Ultrainternational

0.87

Correlation Coefficient

Loomis Sayles  Ultrainternational

Very poor diversification

The 3 months correlation between Loomis and Ultrainternational is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Loomis Sayles Inflation and Ultrainternational Profund Ult in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ultrainternational 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 Inflation are associated (or correlated) with Ultrainternational. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ultrainternational has no effect on the direction of Loomis Sayles i.e., Loomis Sayles and Ultrainternational go up and down completely randomly.

Pair Corralation between Loomis Sayles and Ultrainternational

Assuming the 90 days horizon Loomis Sayles is expected to generate 2.22 times less return on investment than Ultrainternational. But when comparing it to its historical volatility, Loomis Sayles Inflation is 4.82 times less risky than Ultrainternational. It trades about 0.03 of its potential returns per unit of risk. Ultrainternational Profund Ultrainternational is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest  1,682  in Ultrainternational Profund Ultrainternational on October 22, 2024 and sell it today you would earn a total of  77.00  from holding Ultrainternational Profund Ultrainternational or generate 4.58% return on investment over 90 days.

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

Loomis Sayles Inflation  vs.  Ultrainternational Profund Ult

Loomis Sayles Inflation

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Loomis Sayles Inflation has generated negative risk-adjusted returns adding no value to fund investors. 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.

Ultrainternational

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Ultrainternational Profund Ultrainternational has generated negative risk-adjusted returns adding no value to fund investors. In spite of latest weak performance, the Fund's forward indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the fund investors.

Pair Trading with Loomis Sayles and Ultrainternational

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

The idea behind Loomis Sayles Inflation and Ultrainternational Profund Ultrainternational 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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.