Correlation Between Lazard Small and Lazard Capital
Can any of the company-specific risk be diversified away by investing in both Lazard Small and Lazard Capital 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 Lazard Small and Lazard Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lazard Small Mid Cap and Lazard Capital Allocator, you can compare the effects of market volatilities on Lazard Small and Lazard Capital 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 Lazard Small with a short position of Lazard Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lazard Small and Lazard Capital.
Diversification Opportunities for Lazard Small and Lazard Capital
0.9 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Lazard and Lazard is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding Lazard Small Mid Cap and Lazard Capital Allocator in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lazard Capital Allocator and Lazard Small 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 Lazard Small Mid Cap are associated (or correlated) with Lazard Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lazard Capital Allocator has no effect on the direction of Lazard Small i.e., Lazard Small and Lazard Capital go up and down completely randomly.
Pair Corralation between Lazard Small and Lazard Capital
Assuming the 90 days horizon Lazard Small Mid Cap is expected to generate 1.93 times more return on investment than Lazard Capital. However, Lazard Small is 1.93 times more volatile than Lazard Capital Allocator. It trades about 0.19 of its potential returns per unit of risk. Lazard Capital Allocator is currently generating about 0.26 per unit of risk. If you would invest 1,101 in Lazard Small Mid Cap on September 6, 2024 and sell it today you would earn a total of 159.00 from holding Lazard Small Mid Cap or generate 14.44% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Strong |
Accuracy | 100.0% |
Values | Daily Returns |
Lazard Small Mid Cap vs. Lazard Capital Allocator
Performance |
Timeline |
Lazard Small Mid |
Lazard Capital Allocator |
Lazard Small and Lazard Capital Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Lazard Small and Lazard Capital
The main advantage of trading using opposite Lazard Small and Lazard Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lazard Small position performs unexpectedly, Lazard Capital 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 Capital will offset losses from the drop in Lazard Capital's long position.Lazard Small vs. Lazard Small Mid Cap | Lazard Small vs. Lazard International Equity | Lazard Small vs. Lazard International Small | Lazard Small vs. Loomis Sayles Small |
Lazard Capital vs. Lazard Capital Allocator | Lazard Capital vs. Cullen International High | Lazard Capital vs. Cullen High Dividend | Lazard Capital vs. Lazard International Equity |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
Other Complementary Tools
Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios | |
Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges | |
Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges |