Correlation Between Lord Abbett and Mutual Of
Can any of the company-specific risk be diversified away by investing in both Lord Abbett and Mutual Of 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 Mutual Of 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 Mutual Of America, you can compare the effects of market volatilities on Lord Abbett and Mutual Of 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 Mutual Of. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lord Abbett and Mutual Of.
Diversification Opportunities for Lord Abbett and Mutual Of
-0.25 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Lord and Mutual is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding Lord Abbett Convertible and Mutual Of America in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mutual Of America 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 Mutual Of. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mutual Of America has no effect on the direction of Lord Abbett i.e., Lord Abbett and Mutual Of go up and down completely randomly.
Pair Corralation between Lord Abbett and Mutual Of
Assuming the 90 days horizon Lord Abbett Convertible is expected to generate 1.84 times more return on investment than Mutual Of. However, Lord Abbett is 1.84 times more volatile than Mutual Of America. It trades about 0.49 of its potential returns per unit of risk. Mutual Of America is currently generating about 0.16 per unit of risk. If you would invest 1,395 in Lord Abbett Convertible on August 30, 2024 and sell it today you would earn a total of 95.00 from holding Lord Abbett Convertible or generate 6.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lord Abbett Convertible vs. Mutual Of America
Performance |
| Timeline |
| Lord Abbett Convertible |
| Mutual Of America |
Lord Abbett and Mutual Of Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lord Abbett and Mutual Of
The main advantage of trading using opposite Lord Abbett and Mutual Of positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lord Abbett position performs unexpectedly, Mutual Of 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 Mutual Of will offset losses from the drop in Mutual Of's 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 |
| Mutual Of vs. Americafirst Large Cap | Mutual Of vs. Touchstone Large Cap | Mutual Of vs. Fundamental Large Cap | Mutual Of vs. Vanguard Equity Income |
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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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