Correlation Between Federated Hermes and Lazard Equity
Can any of the company-specific risk be diversified away by investing in both Federated Hermes and Lazard Equity 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 Hermes and Lazard Equity into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Federated Hermes Inflation and Lazard Equity Franchise, you can compare the effects of market volatilities on Federated Hermes and Lazard Equity 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 Hermes with a short position of Lazard Equity. Check out your portfolio center. Please also check ongoing floating volatility patterns of Federated Hermes and Lazard Equity.
Diversification Opportunities for Federated Hermes and Lazard Equity
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Federated and Lazard is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Federated Hermes Inflation and Lazard Equity Franchise in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lazard Equity Franchise and Federated Hermes 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 Hermes Inflation are associated (or correlated) with Lazard Equity. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lazard Equity Franchise has no effect on the direction of Federated Hermes i.e., Federated Hermes and Lazard Equity go up and down completely randomly.
Pair Corralation between Federated Hermes and Lazard Equity
Assuming the 90 days horizon Federated Hermes Inflation is expected to generate 0.37 times more return on investment than Lazard Equity. However, Federated Hermes Inflation is 2.68 times less risky than Lazard Equity. It trades about -0.04 of its potential returns per unit of risk. Lazard Equity Franchise is currently generating about -0.1 per unit of risk. If you would invest 996.00 in Federated Hermes Inflation on September 13, 2024 and sell it today you would lose (5.00) from holding Federated Hermes Inflation or give up 0.5% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 97.67% |
| Values | Daily Returns |
Federated Hermes Inflation vs. Lazard Equity Franchise
Performance |
| Timeline |
| Federated Hermes Inf |
| Lazard Equity Franchise |
Federated Hermes and Lazard Equity Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Federated Hermes and Lazard Equity
The main advantage of trading using opposite Federated Hermes and Lazard Equity positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Federated Hermes position performs unexpectedly, Lazard Equity 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 Equity will offset losses from the drop in Lazard Equity's long position.| Federated Hermes vs. Gabelli Convertible And | Federated Hermes vs. Putnam Convertible Incm Gwth | Federated Hermes vs. Allianzgi Convertible Income | Federated Hermes vs. Rationalpier 88 Convertible |
| Lazard Equity vs. Lazard Global Dynamic | Lazard Equity vs. Lazard Global Dynamic | Lazard Equity vs. Lazard International Quality | Lazard Equity vs. Lazard Small Mid Cap |
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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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