Correlation Between Hunter Small and Lord Abbett
Can any of the company-specific risk be diversified away by investing in both Hunter Small and Lord Abbett 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 Hunter Small and Lord Abbett into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hunter Small Cap and Lord Abbett Short, you can compare the effects of market volatilities on Hunter Small and Lord Abbett 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 Hunter Small with a short position of Lord Abbett. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hunter Small and Lord Abbett.
Diversification Opportunities for Hunter Small and Lord Abbett
-0.1 | Correlation Coefficient |
Good diversification
The 3 months correlation between Hunter and Lord is -0.1. Overlapping area represents the amount of risk that can be diversified away by holding Hunter Small Cap and Lord Abbett Short in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lord Abbett Short and Hunter Small 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 Hunter Small Cap are associated (or correlated) with Lord Abbett. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lord Abbett Short has no effect on the direction of Hunter Small i.e., Hunter Small and Lord Abbett go up and down completely randomly.
Pair Corralation between Hunter Small and Lord Abbett
Assuming the 90 days horizon Hunter Small Cap is expected to generate 7.09 times more return on investment than Lord Abbett. However, Hunter Small is 7.09 times more volatile than Lord Abbett Short. It trades about 0.22 of its potential returns per unit of risk. Lord Abbett Short is currently generating about 0.24 per unit of risk. If you would invest 1,245 in Hunter Small Cap on October 23, 2024 and sell it today you would earn a total of 45.00 from holding Hunter Small Cap or generate 3.61% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 94.74% |
| Values | Daily Returns |
Hunter Small Cap vs. Lord Abbett Short
Performance |
| Timeline |
| Hunter Small Cap |
| Lord Abbett Short |
Hunter Small and Lord Abbett Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hunter Small and Lord Abbett
The main advantage of trading using opposite Hunter Small and Lord Abbett positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hunter Small position performs unexpectedly, Lord Abbett 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 Lord Abbett will offset losses from the drop in Lord Abbett's long position.| Hunter Small vs. Pace Smallmedium Value | Hunter Small vs. Touchstone Small Cap | Hunter Small vs. Small Pany Growth | Hunter Small vs. Aqr Small Cap |
| Lord Abbett vs. Hunter Small Cap | Lord Abbett vs. Ab Small Cap | Lord Abbett vs. Glg Intl Small | Lord Abbett vs. Df Dent Small |
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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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