Correlation Between Lazard Global and Lazard Equity
Can any of the company-specific risk be diversified away by investing in both Lazard Global 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 Lazard Global and Lazard Equity into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lazard Global Equity and Lazard Equity Centrated, you can compare the effects of market volatilities on Lazard Global 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 Lazard Global with a short position of Lazard Equity. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lazard Global and Lazard Equity.
Diversification Opportunities for Lazard Global and Lazard Equity
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between LAZARD and Lazard is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Lazard Global Equity and Lazard Equity Centrated in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lazard Equity Centrated and Lazard Global 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 Lazard Global Equity 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 Centrated has no effect on the direction of Lazard Global i.e., Lazard Global and Lazard Equity go up and down completely randomly.
Pair Corralation between Lazard Global and Lazard Equity
Assuming the 90 days horizon Lazard Global is expected to generate 1.17 times less return on investment than Lazard Equity. But when comparing it to its historical volatility, Lazard Global Equity is 1.21 times less risky than Lazard Equity. It trades about 0.07 of its potential returns per unit of risk. Lazard Equity Centrated is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 768.00 in Lazard Equity Centrated on September 1, 2024 and sell it today you would earn a total of 239.00 from holding Lazard Equity Centrated or generate 31.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.8% |
| Values | Daily Returns |
Lazard Global Equity vs. Lazard Equity Centrated
Performance |
| Timeline |
| Lazard Global Equity |
| Lazard Equity Centrated |
Lazard Global and Lazard Equity Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lazard Global and Lazard Equity
The main advantage of trading using opposite Lazard Global and Lazard Equity positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lazard Global 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.| Lazard Global vs. Western Asset Total | Lazard Global vs. Prudential Jennison Equity | Lazard Global vs. Oppenheimer Developing Markets | Lazard Global vs. Aquagold International |
| Lazard Equity vs. Siit Dynamic Asset | Lazard Equity vs. Siit Large Cap | Lazard Equity vs. Nationwide Sp 500 | Lazard Equity vs. Columbia Large 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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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