Correlation Between Eaton Vance and Lord Abbett
Can any of the company-specific risk be diversified away by investing in both Eaton Vance and Lord Abbett 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 Eaton Vance and Lord Abbett into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Eaton Vance Large Cap and Lord Abbett Diversified, you can compare the effects of market volatilities on Eaton Vance and Lord Abbett 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 Eaton Vance with a short position of Lord Abbett. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eaton Vance and Lord Abbett.
Diversification Opportunities for Eaton Vance and Lord Abbett
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Eaton and Lord is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Eaton Vance Large Cap and Lord Abbett Diversified in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lord Abbett Diversified and Eaton Vance 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 Eaton Vance Large Cap are associated (or correlated) with Lord Abbett. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lord Abbett Diversified has no effect on the direction of Eaton Vance i.e., Eaton Vance and Lord Abbett go up and down completely randomly.
Pair Corralation between Eaton Vance and Lord Abbett
Assuming the 90 days horizon Eaton Vance is expected to generate 1.02 times less return on investment than Lord Abbett. In addition to that, Eaton Vance is 2.17 times more volatile than Lord Abbett Diversified. It trades about 0.05 of its total potential returns per unit of risk. Lord Abbett Diversified is currently generating about 0.1 per unit of volatility. If you would invest 1,364 in Lord Abbett Diversified on August 26, 2024 and sell it today you would earn a total of 276.00 from holding Lord Abbett Diversified or generate 20.23% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Eaton Vance Large Cap vs. Lord Abbett Diversified
Performance |
| Timeline |
| Eaton Vance Large |
| Lord Abbett Diversified |
Eaton Vance and Lord Abbett Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Eaton Vance and Lord Abbett
The main advantage of trading using opposite Eaton Vance and Lord Abbett positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eaton Vance position performs unexpectedly, Lord Abbett 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 Lord Abbett will offset losses from the drop in Lord Abbett's long position.| Eaton Vance vs. Lord Abbett Diversified | Eaton Vance vs. Archer Balanced Fund | Eaton Vance vs. Materials Portfolio Fidelity | Eaton Vance vs. Vanguard Strategic Small Cap |
| Lord Abbett vs. Small Cap Stock | Lord Abbett vs. Qs Growth Fund | Lord Abbett vs. Eic Value Fund | Lord Abbett vs. Volumetric Fund Volumetric |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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