Correlation Between Federated High and Lord Abbett
Can any of the company-specific risk be diversified away by investing in both Federated High 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 Federated High and Lord Abbett into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Federated High Income and Lord Abbett Convertible, you can compare the effects of market volatilities on Federated High 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 Federated High with a short position of Lord Abbett. Check out your portfolio center. Please also check ongoing floating volatility patterns of Federated High and Lord Abbett.
Diversification Opportunities for Federated High and Lord Abbett
0.03 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Federated and Lord is 0.03. Overlapping area represents the amount of risk that can be diversified away by holding Federated High Income and Lord Abbett Convertible in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lord Abbett Convertible and Federated High 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 Federated High 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 Convertible has no effect on the direction of Federated High i.e., Federated High and Lord Abbett go up and down completely randomly.
Pair Corralation between Federated High and Lord Abbett
If you would invest 1,458 in Lord Abbett Convertible on September 12, 2024 and sell it today you would earn a total of 28.00 from holding Lord Abbett Convertible or generate 1.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 4.55% |
| Values | Daily Returns |
Federated High Income vs. Lord Abbett Convertible
Performance |
| Timeline |
| Federated High Income |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Lord Abbett Convertible |
Federated High and Lord Abbett Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Federated High and Lord Abbett
The main advantage of trading using opposite Federated High and Lord Abbett positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Federated High 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.| Federated High vs. T Rowe Price | Federated High vs. Dws Government Money | Federated High vs. Blrc Sgy Mnp | Federated High vs. T Rowe Price |
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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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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