Correlation Between Rmb Mendon and Loomis Sayles

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

By analyzing existing cross correlation between Rmb Mendon Financial and Loomis Sayles Inflation, you can compare the effects of market volatilities on Rmb Mendon and Loomis Sayles 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 Rmb Mendon with a short position of Loomis Sayles. Check out your portfolio center. Please also check ongoing floating volatility patterns of Rmb Mendon and Loomis Sayles.

Diversification Opportunities for Rmb Mendon and Loomis Sayles

-0.1

Correlation Coefficient

Rmb Mendon  Loomis Sayles

Good diversification

The 3 months correlation between Rmb and Loomis is -0.1. Overlapping area represents the amount of risk that can be diversified away by holding Rmb Mendon Financial and Loomis Sayles Inflation in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Loomis Sayles Inflation and Rmb Mendon 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 Rmb Mendon Financial are associated (or correlated) with Loomis Sayles. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Loomis Sayles Inflation has no effect on the direction of Rmb Mendon i.e., Rmb Mendon and Loomis Sayles go up and down completely randomly.

Pair Corralation between Rmb Mendon and Loomis Sayles

Assuming the 90 days horizon Rmb Mendon Financial is expected to under-perform the Loomis Sayles. In addition to that, Rmb Mendon is 5.34 times more volatile than Loomis Sayles Inflation. It trades about -0.05 of its total potential returns per unit of risk. Loomis Sayles Inflation is currently generating about 0.19 per unit of volatility. If you would invest  944.00  in Loomis Sayles Inflation on December 19, 2024 and sell it today you would earn a total of  27.00  from holding Loomis Sayles Inflation or generate 2.86% return on investment over 90 days.

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

Rmb Mendon Financial  vs.  Loomis Sayles Inflation

Rmb Mendon Financial

Risk-Adjusted Performance

Very Weak

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

Loomis Sayles Inflation

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Loomis Sayles Inflation are ranked lower than 14 (%) of all funds and portfolios of funds over the last 90 days. 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.

Pair Trading with Rmb Mendon and Loomis Sayles

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

The idea behind Rmb Mendon Financial and Loomis Sayles Inflation 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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.