Correlation Between Lifestyle and L Abbett
Can any of the company-specific risk be diversified away by investing in both Lifestyle and L 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 Lifestyle and L Abbett into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lifestyle Ii Growth and L Abbett Growth, you can compare the effects of market volatilities on Lifestyle and L 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 Lifestyle with a short position of L Abbett. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lifestyle and L Abbett.
Diversification Opportunities for Lifestyle and L Abbett
Very weak diversification
The 3 months correlation between Lifestyle and LGLSX is 0.46. Overlapping area represents the amount of risk that can be diversified away by holding Lifestyle Ii Growth and L Abbett Growth in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on L Abbett Growth and Lifestyle 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 Lifestyle Ii Growth are associated (or correlated) with L Abbett. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of L Abbett Growth has no effect on the direction of Lifestyle i.e., Lifestyle and L Abbett go up and down completely randomly.
Pair Corralation between Lifestyle and L Abbett
Assuming the 90 days horizon Lifestyle is expected to generate 5.45 times less return on investment than L Abbett. But when comparing it to its historical volatility, Lifestyle Ii Growth is 2.51 times less risky than L Abbett. It trades about 0.08 of its potential returns per unit of risk. L Abbett Growth is currently generating about 0.17 of returns per unit of risk over similar time horizon. If you would invest 3,849 in L Abbett Growth on November 2, 2024 and sell it today you would earn a total of 1,104 from holding L Abbett Growth or generate 28.68% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.04% |
| Values | Daily Returns |
Lifestyle Ii Growth vs. L Abbett Growth
Performance |
| Timeline |
| Lifestyle Ii Growth |
| L Abbett Growth |
Lifestyle and L Abbett Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lifestyle and L Abbett
The main advantage of trading using opposite Lifestyle and L Abbett positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lifestyle position performs unexpectedly, L 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 L Abbett will offset losses from the drop in L Abbett's long position.| Lifestyle vs. Buffalo Small Cap | Lifestyle vs. Hunter Small Cap | Lifestyle vs. Touchstone Small Cap | Lifestyle vs. Small Pany Growth |
| L Abbett vs. Oakhurst Short Duration | L Abbett vs. Vela Short Duration | L Abbett vs. Transam Short Term Bond | L Abbett vs. Aqr Sustainable Long Short |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
Other Complementary Tools
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges | |
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
| Commodity Directory Find actively traded commodities issued by global exchanges | |
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios |