Correlation Between Henderson European and Loomis Sayles
Can any of the company-specific risk be diversified away by investing in both Henderson European 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 Henderson European and Loomis Sayles into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Henderson European Focus and Loomis Sayles Strategic, you can compare the effects of market volatilities on Henderson European 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 Henderson European with a short position of Loomis Sayles. Check out your portfolio center. Please also check ongoing floating volatility patterns of Henderson European and Loomis Sayles.
Diversification Opportunities for Henderson European and Loomis Sayles
0.11 | Correlation Coefficient |
Average diversification
The 3 months correlation between Henderson and Loomis is 0.11. Overlapping area represents the amount of risk that can be diversified away by holding Henderson European Focus and Loomis Sayles Strategic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Loomis Sayles Strategic and Henderson European 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 Henderson European Focus 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 Strategic has no effect on the direction of Henderson European i.e., Henderson European and Loomis Sayles go up and down completely randomly.
Pair Corralation between Henderson European and Loomis Sayles
Assuming the 90 days horizon Henderson European Focus is expected to under-perform the Loomis Sayles. In addition to that, Henderson European is 3.57 times more volatile than Loomis Sayles Strategic. It trades about -0.24 of its total potential returns per unit of risk. Loomis Sayles Strategic is currently generating about 0.07 per unit of volatility. If you would invest 1,222 in Loomis Sayles Strategic on August 29, 2024 and sell it today you would earn a total of 5.00 from holding Loomis Sayles Strategic or generate 0.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Henderson European Focus vs. Loomis Sayles Strategic
Performance |
| Timeline |
| Henderson European Focus |
| Loomis Sayles Strategic |
Henderson European and Loomis Sayles Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Henderson European and Loomis Sayles
The main advantage of trading using opposite Henderson European and Loomis Sayles positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Henderson European 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.| Henderson European vs. Doubleline Shiller Enhanced | Henderson European vs. Doubleline Strategic Modity | Henderson European vs. Barclays ETN Shiller | Henderson European vs. Aquagold International |
| Loomis Sayles vs. Maryland Tax Free Bond | Loomis Sayles vs. Vanguard High Yield Tax Exempt | Loomis Sayles vs. Dreyfusstandish Global Fixed | Loomis Sayles vs. Rationalpier 88 Convertible |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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