Correlation Between Lord Abbett and Miller Convertible
Can any of the company-specific risk be diversified away by investing in both Lord Abbett and Miller Convertible 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 Miller Convertible 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 Miller Vertible Bond, you can compare the effects of market volatilities on Lord Abbett and Miller Convertible 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 Miller Convertible. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lord Abbett and Miller Convertible.
Diversification Opportunities for Lord Abbett and Miller Convertible
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Lord and Miller is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding Lord Abbett Vertible and Miller Vertible Bond in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Miller Vertible 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 Vertible are associated (or correlated) with Miller Convertible. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Miller Vertible Bond has no effect on the direction of Lord Abbett i.e., Lord Abbett and Miller Convertible go up and down completely randomly.
Pair Corralation between Lord Abbett and Miller Convertible
Assuming the 90 days horizon Lord Abbett Vertible is expected to generate 1.54 times more return on investment than Miller Convertible. However, Lord Abbett is 1.54 times more volatile than Miller Vertible Bond. It trades about 0.49 of its potential returns per unit of risk. Miller Vertible Bond is currently generating about 0.15 per unit of risk. If you would invest 1,382 in Lord Abbett Vertible on August 29, 2024 and sell it today you would earn a total of 91.00 from holding Lord Abbett Vertible or generate 6.58% 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. Miller Vertible Bond
Performance |
| Timeline |
| Lord Abbett Vertible |
| Miller Vertible Bond |
Lord Abbett and Miller Convertible Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lord Abbett and Miller Convertible
The main advantage of trading using opposite Lord Abbett and Miller Convertible positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lord Abbett position performs unexpectedly, Miller Convertible 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 Miller Convertible will offset losses from the drop in Miller Convertible's long position.| Lord Abbett vs. Gabelli Convertible And | Lord Abbett vs. Virtus Convertible | Lord Abbett vs. Lord Abbett Convertible | Lord Abbett vs. Calamos Dynamic Convertible |
| Miller Convertible vs. Miller Opportunity Trust | Miller Convertible vs. Miller Vertible Bond | Miller Convertible vs. Miller Vertible Bond | Miller Convertible vs. Miller Opportunity Trust |
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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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