Correlation Between Tiaa-cref Equity and Lebenthal Lisanti

Can any of the company-specific risk be diversified away by investing in both Tiaa-cref Equity and Lebenthal Lisanti 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 Tiaa-cref Equity and Lebenthal Lisanti into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Tiaa Cref Equity Index and Lebenthal Lisanti Small, you can compare the effects of market volatilities on Tiaa-cref Equity and Lebenthal Lisanti 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 Tiaa-cref Equity with a short position of Lebenthal Lisanti. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tiaa-cref Equity and Lebenthal Lisanti.

Diversification Opportunities for Tiaa-cref Equity and Lebenthal Lisanti

0.61

Correlation Coefficient

Tiaa-cref Equity  Lebenthal Lisanti

Poor diversification

The 3 months correlation between Tiaa-cref and Lebenthal is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding Tiaa Cref Equity Index and Lebenthal Lisanti Small in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lebenthal Lisanti Small and Tiaa-cref Equity 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 Tiaa Cref Equity Index are associated (or correlated) with Lebenthal Lisanti. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lebenthal Lisanti Small has no effect on the direction of Tiaa-cref Equity i.e., Tiaa-cref Equity and Lebenthal Lisanti go up and down completely randomly.

Pair Corralation between Tiaa-cref Equity and Lebenthal Lisanti

Assuming the 90 days horizon Tiaa Cref Equity Index is expected to generate 0.6 times more return on investment than Lebenthal Lisanti. However, Tiaa Cref Equity Index is 1.66 times less risky than Lebenthal Lisanti. It trades about -0.08 of its potential returns per unit of risk. Lebenthal Lisanti Small is currently generating about -0.19 per unit of risk. If you would invest  4,118  in Tiaa Cref Equity Index on December 29, 2024 and sell it today you would lose (227.00) from holding Tiaa Cref Equity Index or give up 5.51% of portfolio value over 90 days.

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

Tiaa Cref Equity Index  vs.  Lebenthal Lisanti Small

Tiaa Cref Equity

Risk-Adjusted Performance

Very Weak

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

Lebenthal Lisanti Small

Risk-Adjusted Performance

Very Weak

Over the last 90 days Lebenthal Lisanti Small has generated negative risk-adjusted returns adding no value to fund investors. In spite of weak performance in the last few months, the Fund's technical and fundamental indicators remain fairly strong which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long term up-swing for the fund investors.

Pair Trading with Tiaa-cref Equity and Lebenthal Lisanti

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

The idea behind Tiaa Cref Equity Index and Lebenthal Lisanti Small 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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..