Correlation Between Lebenthal Lisanti and Small Midcap
Can any of the company-specific risk be diversified away by investing in both Lebenthal Lisanti and Small Midcap 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 Small Midcap 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 Small Midcap Dividend Income, you can compare the effects of market volatilities on Lebenthal Lisanti and Small Midcap 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 Small Midcap. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lebenthal Lisanti and Small Midcap.
Diversification Opportunities for Lebenthal Lisanti and Small Midcap
0.97 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Lebenthal and Small is 0.97. Overlapping area represents the amount of risk that can be diversified away by holding Lebenthal Lisanti Small and Small Midcap Dividend Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Small Midcap Dividend 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 Small Midcap. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Small Midcap Dividend has no effect on the direction of Lebenthal Lisanti i.e., Lebenthal Lisanti and Small Midcap go up and down completely randomly.
Pair Corralation between Lebenthal Lisanti and Small Midcap
Assuming the 90 days horizon Lebenthal Lisanti is expected to generate 1.0 times less return on investment than Small Midcap. In addition to that, Lebenthal Lisanti is 1.36 times more volatile than Small Midcap Dividend Income. It trades about 0.07 of its total potential returns per unit of risk. Small Midcap Dividend Income is currently generating about 0.09 per unit of volatility. If you would invest 1,491 in Small Midcap Dividend Income on August 27, 2024 and sell it today you would earn a total of 555.00 from holding Small Midcap Dividend Income or generate 37.22% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lebenthal Lisanti Small vs. Small Midcap Dividend Income
Performance |
| Timeline |
| Lebenthal Lisanti Small |
| Small Midcap Dividend |
Lebenthal Lisanti and Small Midcap Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lebenthal Lisanti and Small Midcap
The main advantage of trading using opposite Lebenthal Lisanti and Small Midcap positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lebenthal Lisanti position performs unexpectedly, Small Midcap 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 Small Midcap will offset losses from the drop in Small Midcap's long position.| Lebenthal Lisanti vs. Lord Abbett Growth | Lebenthal Lisanti vs. Queens Road Small | Lebenthal Lisanti vs. Eaton Vance Large Cap |
| Small Midcap vs. Bbh Intermediate Municipal | Small Midcap vs. California Bond Fund | Small Midcap vs. Nuveen Minnesota Municipal | Small Midcap vs. Alliancebernstein National Municipal |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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