Correlation Between Lazard Funds and Lazard Equity
Can any of the company-specific risk be diversified away by investing in both Lazard Funds and Lazard Equity 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 Lazard Funds and Lazard Equity into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between The Lazard Funds and Lazard Equity Franchise, you can compare the effects of market volatilities on Lazard Funds and Lazard Equity 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 Lazard Funds with a short position of Lazard Equity. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lazard Funds and Lazard Equity.
Diversification Opportunities for Lazard Funds and Lazard Equity
0.66 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Lazard and Lazard is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding The Lazard Funds and Lazard Equity Franchise in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lazard Equity Franchise and Lazard Funds 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 The Lazard Funds are associated (or correlated) with Lazard Equity. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lazard Equity Franchise has no effect on the direction of Lazard Funds i.e., Lazard Funds and Lazard Equity go up and down completely randomly.
Pair Corralation between Lazard Funds and Lazard Equity
Assuming the 90 days horizon The Lazard Funds is expected to generate 0.6 times more return on investment than Lazard Equity. However, The Lazard Funds is 1.67 times less risky than Lazard Equity. It trades about 0.04 of its potential returns per unit of risk. Lazard Equity Franchise is currently generating about -0.01 per unit of risk. If you would invest 996.00 in The Lazard Funds on November 28, 2024 and sell it today you would earn a total of 92.00 from holding The Lazard Funds or generate 9.24% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
The Lazard Funds vs. Lazard Equity Franchise
Performance |
| Timeline |
| Lazard Funds |
| Lazard Equity Franchise |
Lazard Funds and Lazard Equity Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lazard Funds and Lazard Equity
The main advantage of trading using opposite Lazard Funds and Lazard Equity positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lazard Funds position performs unexpectedly, Lazard Equity 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 Lazard Equity will offset losses from the drop in Lazard Equity's long position.| Lazard Funds vs. Glg Intl Small | Lazard Funds vs. Astoncrosswind Small Cap | Lazard Funds vs. Touchstone Small Cap | Lazard Funds vs. Ab Small 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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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