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 Income and Lord Abbett Emerging, 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
0.6 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Eaton and Lord is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding Eaton Vance Income and Lord Abbett Emerging in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lord Abbett Emerging 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 Income 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 Emerging 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 1.24 times less return on investment than Lord Abbett. But when comparing it to its historical volatility, Eaton Vance Income is 1.78 times less risky than Lord Abbett. It trades about 0.12 of its potential returns per unit of risk. Lord Abbett Emerging is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 421.00 in Lord Abbett Emerging on September 3, 2024 and sell it today you would earn a total of 6.00 from holding Lord Abbett Emerging or generate 1.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Eaton Vance Income vs. Lord Abbett Emerging
Performance |
| Timeline |
| Eaton Vance Income |
| Lord Abbett Emerging |
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 Emerging | Eaton Vance vs. Wells Fargo Funds | Eaton Vance vs. Hsbc Treasury Money | Eaton Vance vs. Blackrock Exchange Portfolio |
| Lord Abbett vs. Fidelity New Markets | Lord Abbett vs. Fidelity New Markets | Lord Abbett vs. Fidelity New Markets | Lord Abbett vs. Fidelity New Markets |
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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