Correlation Between Lord Abbett and Altegris Futures
Can any of the company-specific risk be diversified away by investing in both Lord Abbett and Altegris Futures 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 Altegris Futures into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lord Abbett Convertible and Altegris Futures Evolution, you can compare the effects of market volatilities on Lord Abbett and Altegris Futures 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 Altegris Futures. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lord Abbett and Altegris Futures.
Diversification Opportunities for Lord Abbett and Altegris Futures
-0.57 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Lord and Altegris is -0.57. Overlapping area represents the amount of risk that can be diversified away by holding Lord Abbett Convertible and Altegris Futures Evolution in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Altegris Futures Evo 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 Convertible are associated (or correlated) with Altegris Futures. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Altegris Futures Evo has no effect on the direction of Lord Abbett i.e., Lord Abbett and Altegris Futures go up and down completely randomly.
Pair Corralation between Lord Abbett and Altegris Futures
Assuming the 90 days horizon Lord Abbett Convertible is expected to under-perform the Altegris Futures. In addition to that, Lord Abbett is 1.01 times more volatile than Altegris Futures Evolution. It trades about -0.11 of its total potential returns per unit of risk. Altegris Futures Evolution is currently generating about -0.1 per unit of volatility. If you would invest 674.00 in Altegris Futures Evolution on September 26, 2024 and sell it today you would lose (11.00) from holding Altegris Futures Evolution or give up 1.63% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lord Abbett Convertible vs. Altegris Futures Evolution
Performance |
| Timeline |
| Lord Abbett Convertible |
| Altegris Futures Evo |
Lord Abbett and Altegris Futures Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lord Abbett and Altegris Futures
The main advantage of trading using opposite Lord Abbett and Altegris Futures positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lord Abbett position performs unexpectedly, Altegris Futures 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 Altegris Futures will offset losses from the drop in Altegris Futures' long position.| Lord Abbett vs. Lord Abbett Trust | Lord Abbett vs. Lord Abbett Trust | Lord Abbett vs. Lord Abbett Focused | Lord Abbett vs. Floating Rate Fund |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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