Correlation Between PJT Partners and Lazard

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

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

Diversification Opportunities for PJT Partners and Lazard

0.89

Correlation Coefficient

PJT Partners  Lazard

Very poor diversification

The 3 months correlation between PJT and Lazard is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding PJT Partners and Lazard in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lazard and PJT Partners 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 PJT Partners 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 PJT Partners i.e., PJT Partners and Lazard go up and down completely randomly.

Pair Corralation between PJT Partners and Lazard

Considering the 90-day investment horizon PJT Partners is expected to generate 0.78 times more return on investment than Lazard. However, PJT Partners is 1.28 times less risky than Lazard. It trades about -0.07 of its potential returns per unit of risk. Lazard is currently generating about -0.06 per unit of risk. If you would invest  15,930  in PJT Partners on December 27, 2024 and sell it today you would lose (1,434) from holding PJT Partners or give up 9.0% of portfolio value over 90 days.

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

PJT Partners  vs.  Lazard

PJT Partners

Risk-Adjusted Performance

Very Weak

Over the last 90 days PJT Partners has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest conflicting performance, the Stock's forward-looking indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private 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 PJT Partners and Lazard

The main advantage of trading using opposite PJT Partners and Lazard positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PJT Partners 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 PJT Partners 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 Commodity Directory module to find actively traded commodities issued by global exchanges.