Correlation Between Ab Impact and Lord Abbett
Can any of the company-specific risk be diversified away by investing in both Ab Impact and Lord Abbett 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 Impact and Lord Abbett into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ab Impact Municipal and Lord Abbett International, you can compare the effects of market volatilities on Ab Impact and Lord Abbett 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 Impact with a short position of Lord Abbett. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ab Impact and Lord Abbett.
Diversification Opportunities for Ab Impact and Lord Abbett
0.37 | Correlation Coefficient |
Weak diversification
The 3 months correlation between ABIMX and Lord is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding Ab Impact Municipal and Lord Abbett International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lord Abbett International and Ab Impact 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 Impact Municipal are associated (or correlated) with Lord Abbett. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lord Abbett International has no effect on the direction of Ab Impact i.e., Ab Impact and Lord Abbett go up and down completely randomly.
Pair Corralation between Ab Impact and Lord Abbett
Assuming the 90 days horizon Ab Impact Municipal is expected to generate 0.47 times more return on investment than Lord Abbett. However, Ab Impact Municipal is 2.12 times less risky than Lord Abbett. It trades about 0.24 of its potential returns per unit of risk. Lord Abbett International is currently generating about -0.06 per unit of risk. If you would invest 979.00 in Ab Impact Municipal on August 31, 2024 and sell it today you would earn a total of 20.00 from holding Ab Impact Municipal or generate 2.04% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Ab Impact Municipal vs. Lord Abbett International
Performance |
| Timeline |
| Ab Impact Municipal |
| Lord Abbett International |
Ab Impact and Lord Abbett Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ab Impact and Lord Abbett
The main advantage of trading using opposite Ab Impact and Lord Abbett positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ab Impact position performs unexpectedly, Lord Abbett 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 Lord Abbett will offset losses from the drop in Lord Abbett's long position.| Ab Impact vs. Barings Emerging Markets | Ab Impact vs. Artisan Emerging Markets | Ab Impact vs. Black Oak Emerging | Ab Impact vs. Ashmore Emerging Markets |
| Lord Abbett vs. Ab Impact Municipal | Lord Abbett vs. Ishares Municipal Bond | Lord Abbett vs. California High Yield Municipal | Lord Abbett vs. Morningstar Municipal Bond |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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