Correlation Between Ab Small and Loomis Sayles
Can any of the company-specific risk be diversified away by investing in both Ab Small 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 Ab Small and Loomis Sayles into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ab Small Cap and Loomis Sayles Small, you can compare the effects of market volatilities on Ab Small 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 Ab Small with a short position of Loomis Sayles. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ab Small and Loomis Sayles.
Diversification Opportunities for Ab Small and Loomis Sayles
0.93 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between SCYVX and Loomis is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding Ab Small Cap and Loomis Sayles Small in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Loomis Sayles Small and Ab 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 Ab Small Cap 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 Small has no effect on the direction of Ab Small i.e., Ab Small and Loomis Sayles go up and down completely randomly.
Pair Corralation between Ab Small and Loomis Sayles
Assuming the 90 days horizon Ab Small Cap is expected to generate 0.9 times more return on investment than Loomis Sayles. However, Ab Small Cap is 1.11 times less risky than Loomis Sayles. It trades about 0.03 of its potential returns per unit of risk. Loomis Sayles Small is currently generating about 0.02 per unit of risk. If you would invest 1,294 in Ab Small Cap on September 26, 2024 and sell it today you would earn a total of 183.00 from holding Ab Small Cap or generate 14.14% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Strong |
Accuracy | 99.8% |
Values | Daily Returns |
Ab Small Cap vs. Loomis Sayles Small
Performance |
Timeline |
Ab Small Cap |
Loomis Sayles Small |
Ab Small and Loomis Sayles Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Ab Small and Loomis Sayles
The main advantage of trading using opposite Ab Small and Loomis Sayles positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ab Small 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.Ab Small vs. William Blair Small Mid | Ab Small vs. T Rowe Price | Ab Small vs. Ab Discovery Value | Ab Small vs. Aquagold International |
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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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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