Correlation Between Lord Abbett and Franklin
Can any of the company-specific risk be diversified away by investing in both Lord Abbett and Franklin 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 Franklin into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lord Abbett Vertible and Franklin Government Money, you can compare the effects of market volatilities on Lord Abbett and Franklin 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 Franklin. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lord Abbett and Franklin.
Diversification Opportunities for Lord Abbett and Franklin
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Lord and Franklin is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding Lord Abbett Vertible and Franklin Government Money in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Franklin Government Money 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 Vertible are associated (or correlated) with Franklin. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Franklin Government Money has no effect on the direction of Lord Abbett i.e., Lord Abbett and Franklin go up and down completely randomly.
Pair Corralation between Lord Abbett and Franklin
If you would invest 1,360 in Lord Abbett Vertible on August 26, 2024 and sell it today you would earn a total of 91.00 from holding Lord Abbett Vertible or generate 6.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lord Abbett Vertible vs. Franklin Government Money
Performance |
| Timeline |
| Lord Abbett Vertible |
| Franklin Government Money |
Lord Abbett and Franklin Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lord Abbett and Franklin
The main advantage of trading using opposite Lord Abbett and Franklin positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lord Abbett position performs unexpectedly, Franklin 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 Franklin will offset losses from the drop in Franklin's long position.| Lord Abbett vs. Lord Abbett Focused | Lord Abbett vs. Floating Rate Fund | Lord Abbett vs. Floating Rate Fund | Lord Abbett vs. Lord Abbett Inv |
| Franklin vs. Lord Abbett Vertible | Franklin vs. Absolute Convertible Arbitrage | Franklin vs. Harbor Vertible Securities | Franklin vs. Allianzgi Convertible Income |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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