Correlation Between Lord Abbett and Deutsche Croci

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

By analyzing existing cross correlation between Lord Abbett Small and Deutsche Croci International, you can compare the effects of market volatilities on Lord Abbett and Deutsche Croci 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 Deutsche Croci. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lord Abbett and Deutsche Croci.

Diversification Opportunities for Lord Abbett and Deutsche Croci

-0.56

Correlation Coefficient

Lord Abbett  Deutsche Croci

Excellent diversification

The 3 months correlation between Lord and Deutsche is -0.56. Overlapping area represents the amount of risk that can be diversified away by holding Lord Abbett Small and Deutsche Croci International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Deutsche Croci Inter 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 Small are associated (or correlated) with Deutsche Croci. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Deutsche Croci Inter has no effect on the direction of Lord Abbett i.e., Lord Abbett and Deutsche Croci go up and down completely randomly.

Pair Corralation between Lord Abbett and Deutsche Croci

Assuming the 90 days horizon Lord Abbett Small is expected to generate 1.48 times more return on investment than Deutsche Croci. However, Lord Abbett is 1.48 times more volatile than Deutsche Croci International. It trades about 0.17 of its potential returns per unit of risk. Deutsche Croci International is currently generating about 0.0 per unit of risk. If you would invest  2,168  in Lord Abbett Small on September 12, 2024 and sell it today you would earn a total of  280.00  from holding Lord Abbett Small or generate 12.92% return on investment over 90 days.

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

Lord Abbett Small  vs.  Deutsche Croci International

Lord Abbett Small

Risk-Adjusted Performance

13 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Lord Abbett Small are ranked lower than 13 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak basic indicators, Lord Abbett showed solid returns over the last few months and may actually be approaching a breakup point.

Deutsche Croci Inter

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with Lord Abbett and Deutsche Croci

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

The idea behind Lord Abbett Small and Deutsche Croci International 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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.