Correlation Between Lord Abbett and Cullen Emerging
Can any of the company-specific risk be diversified away by investing in both Lord Abbett and Cullen Emerging 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 Lord Abbett and Cullen Emerging into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lord Abbett Affiliated and Cullen Emerging Markets, you can compare the effects of market volatilities on Lord Abbett and Cullen Emerging 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 Lord Abbett with a short position of Cullen Emerging. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lord Abbett and Cullen Emerging.
Diversification Opportunities for Lord Abbett and Cullen Emerging
0.17 | Correlation Coefficient |
Average diversification
The 3 months correlation between Lord and Cullen is 0.17. Overlapping area represents the amount of risk that can be diversified away by holding Lord Abbett Affiliated and Cullen Emerging Markets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cullen Emerging Markets and Lord Abbett 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 Lord Abbett Affiliated are associated (or correlated) with Cullen Emerging. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cullen Emerging Markets has no effect on the direction of Lord Abbett i.e., Lord Abbett and Cullen Emerging go up and down completely randomly.
Pair Corralation between Lord Abbett and Cullen Emerging
Assuming the 90 days horizon Lord Abbett Affiliated is expected to under-perform the Cullen Emerging. In addition to that, Lord Abbett is 1.83 times more volatile than Cullen Emerging Markets. It trades about -0.27 of its total potential returns per unit of risk. Cullen Emerging Markets is currently generating about 0.11 per unit of volatility. If you would invest 1,243 in Cullen Emerging Markets on September 13, 2024 and sell it today you would earn a total of 16.00 from holding Cullen Emerging Markets or generate 1.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lord Abbett Affiliated vs. Cullen Emerging Markets
Performance |
| Timeline |
| Lord Abbett Affiliated |
| Cullen Emerging Markets |
Lord Abbett and Cullen Emerging Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lord Abbett and Cullen Emerging
The main advantage of trading using opposite Lord Abbett and Cullen Emerging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lord Abbett position performs unexpectedly, Cullen Emerging 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 Cullen Emerging will offset losses from the drop in Cullen Emerging's long position.| Lord Abbett vs. Lord Abbett Trust | Lord Abbett vs. Lord Abbett Trust | Lord Abbett vs. Lord Abbett Focused | Lord Abbett vs. Floating Rate Fund |
| Cullen Emerging vs. Cullen Small Cap | Cullen Emerging vs. Cullen Small Cap | Cullen Emerging vs. Cullen Value Fund | Cullen Emerging vs. Cullen Value Fund |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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