Correlation Between Lord Abbett and Loomis Sayles
Can any of the company-specific risk be diversified away by investing in both Lord Abbett and Loomis Sayles 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 Loomis Sayles into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lord Abbett Bond and Loomis Sayles Bond, you can compare the effects of market volatilities on Lord Abbett and Loomis Sayles 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 Loomis Sayles. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lord Abbett and Loomis Sayles.
Diversification Opportunities for Lord Abbett and Loomis Sayles
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Lord and Loomis is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Lord Abbett Bond and Loomis Sayles Bond in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Loomis Sayles Bond 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 Bond are associated (or correlated) with Loomis Sayles. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Loomis Sayles Bond has no effect on the direction of Lord Abbett i.e., Lord Abbett and Loomis Sayles go up and down completely randomly.
Pair Corralation between Lord Abbett and Loomis Sayles
Assuming the 90 days horizon Lord Abbett is expected to generate 1.01 times less return on investment than Loomis Sayles. But when comparing it to its historical volatility, Lord Abbett Bond is 1.36 times less risky than Loomis Sayles. It trades about 0.15 of its potential returns per unit of risk. Loomis Sayles Bond is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 1,047 in Loomis Sayles Bond on August 29, 2024 and sell it today you would earn a total of 133.00 from holding Loomis Sayles Bond or generate 12.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lord Abbett Bond vs. Loomis Sayles Bond
Performance |
| Timeline |
| Lord Abbett Bond |
| Loomis Sayles Bond |
Lord Abbett and Loomis Sayles Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lord Abbett and Loomis Sayles
The main advantage of trading using opposite Lord Abbett and Loomis Sayles positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lord Abbett position performs unexpectedly, Loomis Sayles 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 Loomis Sayles will offset losses from the drop in Loomis Sayles' long position.| Lord Abbett vs. T Rowe Price | Lord Abbett vs. Nova Fund Class | Lord Abbett vs. Issachar Fund Class | Lord Abbett vs. Barings Active Short |
| Loomis Sayles vs. Rbc Emerging Markets | Loomis Sayles vs. T Rowe Price | Loomis Sayles vs. Touchstone Sands Capital | Loomis Sayles vs. Barings Emerging Markets |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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