Correlation Between Kinetics Small and Lazard Equity
Can any of the company-specific risk be diversified away by investing in both Kinetics Small 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 Kinetics Small and Lazard Equity into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kinetics Small Cap and Lazard Equity Franchise, you can compare the effects of market volatilities on Kinetics Small 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 Kinetics Small with a short position of Lazard Equity. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kinetics Small and Lazard Equity.
Diversification Opportunities for Kinetics Small and Lazard Equity
-0.79 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Kinetics and Lazard is -0.79. Overlapping area represents the amount of risk that can be diversified away by holding Kinetics Small Cap and Lazard Equity Franchise in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lazard Equity Franchise and Kinetics 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 Kinetics Small Cap 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 Franchise has no effect on the direction of Kinetics Small i.e., Kinetics Small and Lazard Equity go up and down completely randomly.
Pair Corralation between Kinetics Small and Lazard Equity
Assuming the 90 days horizon Kinetics Small Cap is expected to under-perform the Lazard Equity. In addition to that, Kinetics Small is 4.63 times more volatile than Lazard Equity Franchise. It trades about -0.07 of its total potential returns per unit of risk. Lazard Equity Franchise is currently generating about -0.03 per unit of volatility. If you would invest 1,014 in Lazard Equity Franchise on September 12, 2024 and sell it today you would lose (5.00) from holding Lazard Equity Franchise or give up 0.49% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Kinetics Small Cap vs. Lazard Equity Franchise
Performance |
| Timeline |
| Kinetics Small Cap |
| Lazard Equity Franchise |
Kinetics Small and Lazard Equity Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kinetics Small and Lazard Equity
The main advantage of trading using opposite Kinetics Small and Lazard Equity positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kinetics Small 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.| Kinetics Small vs. Aqr Small Cap | Kinetics Small vs. Pace Smallmedium Value | Kinetics Small vs. Lebenthal Lisanti Small | Kinetics Small vs. Old Westbury Small |
| Lazard Equity vs. Federated Hermes Inflation | Lazard Equity vs. Ab Bond Inflation | Lazard Equity vs. Loomis Sayles Inflation | Lazard Equity vs. Guidepath Managed Futures |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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