Correlation Between Federated Short-term and Loomis Sayles
Can any of the company-specific risk be diversified away by investing in both Federated Short-term and Loomis Sayles 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 Short-term and Loomis Sayles into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Federated Short Term Income and Loomis Sayles Institutional, you can compare the effects of market volatilities on Federated Short-term and Loomis Sayles 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 Short-term with a short position of Loomis Sayles. Check out your portfolio center. Please also check ongoing floating volatility patterns of Federated Short-term and Loomis Sayles.
Diversification Opportunities for Federated Short-term and Loomis Sayles
0.19 | Correlation Coefficient |
Average diversification
The 3 months correlation between FEDERATED and Loomis is 0.19. Overlapping area represents the amount of risk that can be diversified away by holding Federated Short Term Income and Loomis Sayles Institutional in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Loomis Sayles Instit and Federated Short-term 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 Short Term Income are associated (or correlated) with Loomis Sayles. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Loomis Sayles Instit has no effect on the direction of Federated Short-term i.e., Federated Short-term and Loomis Sayles go up and down completely randomly.
Pair Corralation between Federated Short-term and Loomis Sayles
Assuming the 90 days horizon Federated Short-term is expected to generate 1.73 times less return on investment than Loomis Sayles. But when comparing it to its historical volatility, Federated Short Term Income is 1.93 times less risky than Loomis Sayles. It trades about 0.13 of its potential returns per unit of risk. Loomis Sayles Institutional is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 506.00 in Loomis Sayles Institutional on September 4, 2024 and sell it today you would earn a total of 97.00 from holding Loomis Sayles Institutional or generate 19.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 99.8% |
| Values | Daily Returns |
Federated Short Term Income vs. Loomis Sayles Institutional
Performance |
| Timeline |
| Federated Short Term |
| Loomis Sayles Instit |
Federated Short-term and Loomis Sayles Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Federated Short-term and Loomis Sayles
The main advantage of trading using opposite Federated Short-term and Loomis Sayles positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Federated Short-term position performs unexpectedly, Loomis Sayles 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 Loomis Sayles will offset losses from the drop in Loomis Sayles' long position.| Federated Short-term vs. American Century Etf | Federated Short-term vs. Lord Abbett Small | Federated Short-term vs. Victory Rs Partners | Federated Short-term vs. Royce Opportunity Fund |
| Loomis Sayles vs. Loomis Sayles Inflation | Loomis Sayles vs. Loomis Sayles Inflation | Loomis Sayles vs. Loomis Sayles Bond | Loomis Sayles vs. Loomis Sayles Bond |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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