Correlation Between Piper Sandler and Lazard

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

By analyzing existing cross correlation between Piper Sandler Companies and Lazard, you can compare the effects of market volatilities on Piper Sandler and Lazard 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 Piper Sandler with a short position of Lazard. Check out your portfolio center. Please also check ongoing floating volatility patterns of Piper Sandler and Lazard.

Diversification Opportunities for Piper Sandler and Lazard

0.88

Correlation Coefficient

Piper Sandler  Lazard

Very poor diversification

The 3 months correlation between Piper and Lazard is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Piper Sandler Companies and Lazard in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lazard and Piper Sandler 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 Piper Sandler Companies are associated (or correlated) with Lazard. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lazard has no effect on the direction of Piper Sandler i.e., Piper Sandler and Lazard go up and down completely randomly.

Pair Corralation between Piper Sandler and Lazard

Given the investment horizon of 90 days Piper Sandler Companies is expected to under-perform the Lazard. But the stock apears to be less risky and, when comparing its historical volatility, Piper Sandler Companies is 1.28 times less risky than Lazard. The stock trades about -0.13 of its potential returns per unit of risk. The Lazard is currently generating about -0.07 of returns per unit of risk over similar time horizon. If you would invest  5,118  in Lazard on December 28, 2024 and sell it today you would lose (637.00) from holding Lazard or give up 12.45% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Strong
Accuracy	98.36%
Values	Daily Returns

Piper Sandler Companies  vs.  Lazard

Piper Sandler Companies

Risk-Adjusted Performance

Very Weak

Over the last 90 days Piper Sandler Companies has generated negative risk-adjusted returns adding no value to investors with long positions. Even with weak performance in the last few months, the Stock's basic indicators remain relatively invariable which may send shares a bit higher in April 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

Lazard

Risk-Adjusted Performance

Very Weak

Over the last 90 days Lazard has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest uncertain performance, the Stock's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

Pair Trading with Piper Sandler and Lazard

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

The idea behind Piper Sandler Companies and Lazard 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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.