Correlation Between Lazard Global and Lazard Enhanced
Can any of the company-specific risk be diversified away by investing in both Lazard Global and Lazard Enhanced 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 Enhanced into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lazard Global Listed and Lazard Enhanced Opportunities, you can compare the effects of market volatilities on Lazard Global and Lazard Enhanced 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 Enhanced. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lazard Global and Lazard Enhanced.
Diversification Opportunities for Lazard Global and Lazard Enhanced
0.42 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Lazard and Lazard is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding Lazard Global Listed and Lazard Enhanced Opportunities in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lazard Enhanced Oppo 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 Listed are associated (or correlated) with Lazard Enhanced. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lazard Enhanced Oppo has no effect on the direction of Lazard Global i.e., Lazard Global and Lazard Enhanced go up and down completely randomly.
Pair Corralation between Lazard Global and Lazard Enhanced
Assuming the 90 days horizon Lazard Global Listed is expected to generate 4.21 times more return on investment than Lazard Enhanced. However, Lazard Global is 4.21 times more volatile than Lazard Enhanced Opportunities. It trades about 0.23 of its potential returns per unit of risk. Lazard Enhanced Opportunities is currently generating about 0.71 per unit of risk. If you would invest 1,597 in Lazard Global Listed on November 28, 2024 and sell it today you would earn a total of 32.00 from holding Lazard Global Listed or generate 2.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lazard Global Listed vs. Lazard Enhanced Opportunities
Performance |
| Timeline |
| Lazard Global Listed |
| Lazard Enhanced Oppo |
Lazard Global and Lazard Enhanced Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lazard Global and Lazard Enhanced
The main advantage of trading using opposite Lazard Global and Lazard Enhanced positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lazard Global position performs unexpectedly, Lazard Enhanced 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 Enhanced will offset losses from the drop in Lazard Enhanced's long position.| Lazard Global vs. International Fund International | Lazard Global vs. Lazard Global Listed | Lazard Global vs. Large Cap Growth | Lazard Global vs. The Value Fund |
| Lazard Enhanced vs. Arrow Managed Futures | Lazard Enhanced vs. Shelton Emerging Markets | Lazard Enhanced vs. Guidemark E Fixed | Lazard Enhanced vs. Tfa Alphagen Growth |
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 Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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