Correlation Between Ashmore Emerging and Lazard Emerging
Can any of the company-specific risk be diversified away by investing in both Ashmore Emerging and Lazard Emerging 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 Ashmore Emerging and Lazard Emerging into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ashmore Emerging Markets and Lazard Emerging Markets, you can compare the effects of market volatilities on Ashmore Emerging and Lazard Emerging 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 Ashmore Emerging with a short position of Lazard Emerging. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ashmore Emerging and Lazard Emerging.
Diversification Opportunities for Ashmore Emerging and Lazard Emerging
-0.08 | Correlation Coefficient |
Good diversification
The 3 months correlation between Ashmore and Lazard is -0.08. Overlapping area represents the amount of risk that can be diversified away by holding Ashmore Emerging Markets and Lazard Emerging Markets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lazard Emerging Markets and Ashmore 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 Ashmore Emerging Markets are associated (or correlated) with Lazard Emerging. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lazard Emerging Markets has no effect on the direction of Ashmore Emerging i.e., Ashmore Emerging and Lazard Emerging go up and down completely randomly.
Pair Corralation between Ashmore Emerging and Lazard Emerging
Assuming the 90 days horizon Ashmore Emerging Markets is expected to under-perform the Lazard Emerging. But the mutual fund apears to be less risky and, when comparing its historical volatility, Ashmore Emerging Markets is 2.27 times less risky than Lazard Emerging. The mutual fund trades about -0.09 of its potential returns per unit of risk. The Lazard Emerging Markets is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest 1,209 in Lazard Emerging Markets on August 29, 2024 and sell it today you would lose (2.00) from holding Lazard Emerging Markets or give up 0.17% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ashmore Emerging Markets vs. Lazard Emerging Markets
Performance |
| Timeline |
| Ashmore Emerging Markets |
| Lazard Emerging Markets |
Ashmore Emerging and Lazard Emerging Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ashmore Emerging and Lazard Emerging
The main advantage of trading using opposite Ashmore Emerging and Lazard Emerging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ashmore Emerging position performs unexpectedly, Lazard Emerging 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 Emerging will offset losses from the drop in Lazard Emerging's long position.| Ashmore Emerging vs. Vanguard Emerging Markets | Ashmore Emerging vs. Vanguard Emerging Markets | Ashmore Emerging vs. HUMANA INC | Ashmore Emerging vs. Aquagold International |
| Lazard Emerging vs. Vanguard Emerging Markets | Lazard Emerging vs. Vanguard Emerging Markets | Lazard Emerging vs. HUMANA INC | Lazard Emerging vs. Aquagold International |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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