Correlation Between Lazard and Zhong Yang
Can any of the company-specific risk be diversified away by investing in both Lazard and Zhong Yang 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 Lazard and Zhong Yang into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lazard and Zhong Yang Financial, you can compare the effects of market volatilities on Lazard and Zhong Yang 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 Lazard with a short position of Zhong Yang. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lazard and Zhong Yang.
Diversification Opportunities for Lazard and Zhong Yang
-0.32 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Lazard and Zhong is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding Lazard and Zhong Yang Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zhong Yang Financial and Lazard 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 Lazard are associated (or correlated) with Zhong Yang. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zhong Yang Financial has no effect on the direction of Lazard i.e., Lazard and Zhong Yang go up and down completely randomly.
Pair Corralation between Lazard and Zhong Yang
Considering the 90-day investment horizon Lazard is expected to generate 1.32 times more return on investment than Zhong Yang. However, Lazard is 1.32 times more volatile than Zhong Yang Financial. It trades about 0.21 of its potential returns per unit of risk. Zhong Yang Financial is currently generating about -0.17 per unit of risk. If you would invest 5,123 in Lazard on August 28, 2024 and sell it today you would earn a total of 843.00 from holding Lazard or generate 16.46% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lazard vs. Zhong Yang Financial
Performance |
| Timeline |
| Lazard |
| Zhong Yang Financial |
Lazard and Zhong Yang Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lazard and Zhong Yang
The main advantage of trading using opposite Lazard and Zhong Yang positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lazard position performs unexpectedly, Zhong Yang 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 Zhong Yang will offset losses from the drop in Zhong Yang's long position.| Lazard vs. PJT Partners | Lazard vs. Moelis Co | Lazard vs. Houlihan Lokey | Lazard vs. Piper Sandler Companies |
| Zhong Yang vs. Netcapital | Zhong Yang vs. Applied Blockchain | Zhong Yang vs. Magic Empire Global | Zhong Yang vs. Lazard |
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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