Correlation Between Lebenthal Lisanti and Franklin Gold
Can any of the company-specific risk be diversified away by investing in both Lebenthal Lisanti and Franklin Gold 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 Franklin Gold 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 Franklin Gold Precious, you can compare the effects of market volatilities on Lebenthal Lisanti and Franklin Gold 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 Franklin Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lebenthal Lisanti and Franklin Gold.
Diversification Opportunities for Lebenthal Lisanti and Franklin Gold
-0.37 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Lebenthal and Franklin is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding Lebenthal Lisanti Small and Franklin Gold Precious in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Franklin Gold Precious 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 Franklin Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Franklin Gold Precious has no effect on the direction of Lebenthal Lisanti i.e., Lebenthal Lisanti and Franklin Gold go up and down completely randomly.
Pair Corralation between Lebenthal Lisanti and Franklin Gold
Assuming the 90 days horizon Lebenthal Lisanti Small is expected to generate 0.49 times more return on investment than Franklin Gold. However, Lebenthal Lisanti Small is 2.05 times less risky than Franklin Gold. It trades about -0.01 of its potential returns per unit of risk. Franklin Gold Precious is currently generating about -0.24 per unit of risk. If you would invest 2,206 in Lebenthal Lisanti Small on October 11, 2024 and sell it today you would lose (15.00) from holding Lebenthal Lisanti Small or give up 0.68% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lebenthal Lisanti Small vs. Franklin Gold Precious
Performance |
| Timeline |
| Lebenthal Lisanti Small |
| Franklin Gold Precious |
Lebenthal Lisanti and Franklin Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lebenthal Lisanti and Franklin Gold
The main advantage of trading using opposite Lebenthal Lisanti and Franklin Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lebenthal Lisanti position performs unexpectedly, Franklin Gold 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 Franklin Gold will offset losses from the drop in Franklin Gold's long position.| Lebenthal Lisanti vs. Lord Abbett Growth | Lebenthal Lisanti vs. Queens Road Small | Lebenthal Lisanti vs. Eaton Vance Large Cap |
| Franklin Gold vs. Lebenthal Lisanti Small | Franklin Gold vs. Champlain Small | Franklin Gold vs. Df Dent Small | Franklin Gold vs. Touchstone Small Cap |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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