Correlation Between Lebenthal Lisanti and Auer Growth
Can any of the company-specific risk be diversified away by investing in both Lebenthal Lisanti and Auer Growth 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 Lebenthal Lisanti and Auer Growth into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lebenthal Lisanti Small and Auer Growth Fund, you can compare the effects of market volatilities on Lebenthal Lisanti and Auer Growth 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 Lebenthal Lisanti with a short position of Auer Growth. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lebenthal Lisanti and Auer Growth.
Diversification Opportunities for Lebenthal Lisanti and Auer Growth
0.69 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Lebenthal and Auer is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding Lebenthal Lisanti Small and Auer Growth Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Auer Growth Fund and Lebenthal Lisanti 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 Lebenthal Lisanti Small are associated (or correlated) with Auer Growth. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Auer Growth Fund has no effect on the direction of Lebenthal Lisanti i.e., Lebenthal Lisanti and Auer Growth go up and down completely randomly.
Pair Corralation between Lebenthal Lisanti and Auer Growth
Assuming the 90 days horizon Lebenthal Lisanti Small is expected to generate 1.66 times more return on investment than Auer Growth. However, Lebenthal Lisanti is 1.66 times more volatile than Auer Growth Fund. It trades about 0.15 of its potential returns per unit of risk. Auer Growth Fund is currently generating about 0.1 per unit of risk. If you would invest 2,044 in Lebenthal Lisanti Small on August 24, 2024 and sell it today you would earn a total of 106.00 from holding Lebenthal Lisanti Small or generate 5.19% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Lebenthal Lisanti Small vs. Auer Growth Fund
Performance |
| Timeline |
| Lebenthal Lisanti Small |
| Auer Growth Fund |
Lebenthal Lisanti and Auer Growth Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lebenthal Lisanti and Auer Growth
The main advantage of trading using opposite Lebenthal Lisanti and Auer Growth positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lebenthal Lisanti position performs unexpectedly, Auer Growth 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 Auer Growth will offset losses from the drop in Auer Growth's long position.| Lebenthal Lisanti vs. Lord Abbett Growth | Lebenthal Lisanti vs. Queens Road Small | Lebenthal Lisanti vs. Eaton Vance Large Cap |
| Auer Growth vs. Lebenthal Lisanti Small | Auer Growth vs. Hodges Small Cap | Auer Growth vs. Oberweis Small Cap Opportunities | Auer Growth vs. Aegis Value Fund |
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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