Correlation Between Lazard Emerging and Lazard International
Can any of the company-specific risk be diversified away by investing in both Lazard Emerging and Lazard International 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 Emerging and Lazard International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lazard Emerging Markets and Lazard International Pounders, you can compare the effects of market volatilities on Lazard Emerging and Lazard International 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 Emerging with a short position of Lazard International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lazard Emerging and Lazard International.
Diversification Opportunities for Lazard Emerging and Lazard International
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Lazard and Lazard is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Lazard Emerging Markets and Lazard International Pounders in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lazard International and Lazard Emerging 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 Lazard Emerging Markets are associated (or correlated) with Lazard International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lazard International has no effect on the direction of Lazard Emerging i.e., Lazard Emerging and Lazard International go up and down completely randomly.
Pair Corralation between Lazard Emerging and Lazard International
Assuming the 90 days horizon Lazard Emerging is expected to generate 2.05 times less return on investment than Lazard International. In addition to that, Lazard Emerging is 1.17 times more volatile than Lazard International Pounders. It trades about 0.02 of its total potential returns per unit of risk. Lazard International Pounders is currently generating about 0.04 per unit of volatility. If you would invest 1,629 in Lazard International Pounders on September 3, 2024 and sell it today you would earn a total of 62.00 from holding Lazard International Pounders or generate 3.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lazard Emerging Markets vs. Lazard International Pounders
Performance |
| Timeline |
| Lazard Emerging Markets |
| Lazard International |
Lazard Emerging and Lazard International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lazard Emerging and Lazard International
The main advantage of trading using opposite Lazard Emerging and Lazard International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lazard Emerging position performs unexpectedly, Lazard International 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 International will offset losses from the drop in Lazard International's long position.| Lazard Emerging vs. Wasatch Emerging Markets | Lazard Emerging vs. Parametric Emerging Markets | Lazard Emerging vs. Amana Developing World |
| Lazard International vs. Fpa Queens Road | Lazard International vs. Heartland Value Plus | Lazard International vs. Ultramid Cap Profund Ultramid Cap | Lazard International vs. Victory Rs Partners |
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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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