Correlation Between Lebenthal Lisanti and Large-cap Growth
Can any of the company-specific risk be diversified away by investing in both Lebenthal Lisanti and Large-cap 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 Large-cap 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 Large Cap Growth Profund, you can compare the effects of market volatilities on Lebenthal Lisanti and Large-cap 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 Large-cap Growth. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lebenthal Lisanti and Large-cap Growth.
Diversification Opportunities for Lebenthal Lisanti and Large-cap Growth
0.27 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Lebenthal and Large-cap is 0.27. Overlapping area represents the amount of risk that can be diversified away by holding Lebenthal Lisanti Small and Large Cap Growth Profund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Large Cap Growth 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 Large-cap Growth. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Large Cap Growth has no effect on the direction of Lebenthal Lisanti i.e., Lebenthal Lisanti and Large-cap Growth go up and down completely randomly.
Pair Corralation between Lebenthal Lisanti and Large-cap Growth
Assuming the 90 days horizon Lebenthal Lisanti is expected to generate 1.01 times less return on investment than Large-cap Growth. In addition to that, Lebenthal Lisanti is 1.28 times more volatile than Large Cap Growth Profund. It trades about 0.07 of its total potential returns per unit of risk. Large Cap Growth Profund is currently generating about 0.09 per unit of volatility. If you would invest 3,680 in Large Cap Growth Profund on November 3, 2024 and sell it today you would earn a total of 987.00 from holding Large Cap Growth Profund or generate 26.82% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 99.6% |
| Values | Daily Returns |
Lebenthal Lisanti Small vs. Large Cap Growth Profund
Performance |
| Timeline |
| Lebenthal Lisanti Small |
| Large Cap Growth |
Lebenthal Lisanti and Large-cap Growth Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lebenthal Lisanti and Large-cap Growth
The main advantage of trading using opposite Lebenthal Lisanti and Large-cap Growth positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lebenthal Lisanti position performs unexpectedly, Large-cap 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 Large-cap Growth will offset losses from the drop in Large-cap Growth's long position.| Lebenthal Lisanti vs. Lord Abbett Growth | Lebenthal Lisanti vs. Queens Road Small | Lebenthal Lisanti vs. Eaton Vance Large Cap |
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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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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