Correlation Between Lazard and Virtu Financial
Can any of the company-specific risk be diversified away by investing in both Lazard and Virtu Financial 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 Virtu Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lazard and Virtu Financial, you can compare the effects of market volatilities on Lazard and Virtu Financial 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 Virtu Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lazard and Virtu Financial.
Diversification Opportunities for Lazard and Virtu Financial
0.23 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Lazard and Virtu is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding Lazard and Virtu Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Virtu 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 Virtu Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Virtu Financial has no effect on the direction of Lazard i.e., Lazard and Virtu Financial go up and down completely randomly.
Pair Corralation between Lazard and Virtu Financial
Considering the 90-day investment horizon Lazard is expected to generate 1.55 times less return on investment than Virtu Financial. In addition to that, Lazard is 1.37 times more volatile than Virtu Financial. It trades about 0.07 of its total potential returns per unit of risk. Virtu Financial is currently generating about 0.14 per unit of volatility. If you would invest 3,085 in Virtu Financial on November 2, 2024 and sell it today you would earn a total of 882.00 from holding Virtu Financial or generate 28.59% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lazard vs. Virtu Financial
Performance |
| Timeline |
| Lazard |
| Virtu Financial |
Lazard and Virtu Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lazard and Virtu Financial
The main advantage of trading using opposite Lazard and Virtu Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lazard position performs unexpectedly, Virtu Financial 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 Virtu Financial will offset losses from the drop in Virtu Financial's long position.| Lazard vs. PJT Partners | Lazard vs. Moelis Co | Lazard vs. Houlihan Lokey | Lazard vs. Piper Sandler Companies |
| Virtu Financial vs. PJT Partners | Virtu Financial vs. Houlihan Lokey | Virtu Financial vs. Piper Sandler Companies | Virtu Financial vs. Perella Weinberg Partners |
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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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