Correlation Between Lord Abbett and Plumb Balanced
Can any of the company-specific risk be diversified away by investing in both Lord Abbett and Plumb Balanced 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 Plumb Balanced 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 Plumb Balanced, you can compare the effects of market volatilities on Lord Abbett and Plumb Balanced 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 Plumb Balanced. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lord Abbett and Plumb Balanced.
Diversification Opportunities for Lord Abbett and Plumb Balanced
0.94 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Lord and Plumb is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding Lord Abbett Convertible and Plumb Balanced in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Plumb Balanced 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 Plumb Balanced. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Plumb Balanced has no effect on the direction of Lord Abbett i.e., Lord Abbett and Plumb Balanced go up and down completely randomly.
Pair Corralation between Lord Abbett and Plumb Balanced
Assuming the 90 days horizon Lord Abbett Convertible is expected to generate 0.95 times more return on investment than Plumb Balanced. However, Lord Abbett Convertible is 1.05 times less risky than Plumb Balanced. It trades about 0.25 of its potential returns per unit of risk. Plumb Balanced is currently generating about 0.12 per unit of risk. If you would invest 1,399 in Lord Abbett Convertible on September 13, 2024 and sell it today you would earn a total of 87.00 from holding Lord Abbett Convertible or generate 6.22% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 97.67% |
| Values | Daily Returns |
Lord Abbett Convertible vs. Plumb Balanced
Performance |
| Timeline |
| Lord Abbett Convertible |
| Plumb Balanced |
Lord Abbett and Plumb Balanced Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lord Abbett and Plumb Balanced
The main advantage of trading using opposite Lord Abbett and Plumb Balanced positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lord Abbett position performs unexpectedly, Plumb Balanced 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 Plumb Balanced will offset losses from the drop in Plumb Balanced's long position.| Lord Abbett vs. Voya High Yield | Lord Abbett vs. Guggenheim High Yield | Lord Abbett vs. T Rowe Price | Lord Abbett vs. Blackrock High Yield |
| Plumb Balanced vs. Advent Claymore Convertible | Plumb Balanced vs. Lord Abbett Convertible | Plumb Balanced vs. Absolute Convertible Arbitrage | Plumb Balanced vs. Gabelli Convertible And |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
Other Complementary Tools
| Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets |