Correlation Between Diamond Hill and Loomis Sayles
Can any of the company-specific risk be diversified away by investing in both Diamond Hill and Loomis Sayles 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 Diamond Hill and Loomis Sayles into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Diamond Hill Large and Loomis Sayles Growth, you can compare the effects of market volatilities on Diamond Hill and Loomis Sayles 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 Diamond Hill with a short position of Loomis Sayles. Check out your portfolio center. Please also check ongoing floating volatility patterns of Diamond Hill and Loomis Sayles.
Diversification Opportunities for Diamond Hill and Loomis Sayles
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Diamond and Loomis is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding Diamond Hill Large and Loomis Sayles Growth in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Loomis Sayles Growth and Diamond Hill 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 Diamond Hill Large are associated (or correlated) with Loomis Sayles. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Loomis Sayles Growth has no effect on the direction of Diamond Hill i.e., Diamond Hill and Loomis Sayles go up and down completely randomly.
Pair Corralation between Diamond Hill and Loomis Sayles
Assuming the 90 days horizon Diamond Hill is expected to generate 3.24 times less return on investment than Loomis Sayles. But when comparing it to its historical volatility, Diamond Hill Large is 1.25 times less risky than Loomis Sayles. It trades about 0.15 of its potential returns per unit of risk. Loomis Sayles Growth is currently generating about 0.39 of returns per unit of risk over similar time horizon. If you would invest 2,585 in Loomis Sayles Growth on September 5, 2024 and sell it today you would earn a total of 227.00 from holding Loomis Sayles Growth or generate 8.78% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Diamond Hill Large vs. Loomis Sayles Growth
Performance |
| Timeline |
| Diamond Hill Large |
| Loomis Sayles Growth |
Diamond Hill and Loomis Sayles Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Diamond Hill and Loomis Sayles
The main advantage of trading using opposite Diamond Hill and Loomis Sayles positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Diamond Hill position performs unexpectedly, Loomis Sayles 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 Loomis Sayles will offset losses from the drop in Loomis Sayles' long position.| Diamond Hill vs. Loomis Sayles Growth | Diamond Hill vs. Loomis Sayles Growth | Diamond Hill vs. Loomis Sayles Growth |
| Loomis Sayles vs. Diamond Hill Large | Loomis Sayles vs. Loomis Sayles Growth | Loomis Sayles vs. Loomis Sayles Growth | Loomis Sayles vs. Natixis Equity Opportunities |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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