Correlation Between Lord Abbett and Cref Money
Can any of the company-specific risk be diversified away by investing in both Lord Abbett and Cref Money 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 Cref Money 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 Cref Money Market, you can compare the effects of market volatilities on Lord Abbett and Cref Money 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 Cref Money. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lord Abbett and Cref Money.
Diversification Opportunities for Lord Abbett and Cref Money
0.93 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Lord and Cref is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding Lord Abbett Convertible and Cref Money Market in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cref Money Market 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 Cref Money. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cref Money Market has no effect on the direction of Lord Abbett i.e., Lord Abbett and Cref Money go up and down completely randomly.
Pair Corralation between Lord Abbett and Cref Money
Assuming the 90 days horizon Lord Abbett Convertible is expected to generate 32.04 times more return on investment than Cref Money. However, Lord Abbett is 32.04 times more volatile than Cref Money Market. It trades about 0.23 of its potential returns per unit of risk. Cref Money Market is currently generating about 0.93 per unit of risk. If you would invest 1,443 in Lord Abbett Convertible on September 15, 2024 and sell it today you would earn a total of 39.00 from holding Lord Abbett Convertible or generate 2.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lord Abbett Convertible vs. Cref Money Market
Performance |
| Timeline |
| Lord Abbett Convertible |
| Cref Money Market |
Lord Abbett and Cref Money Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lord Abbett and Cref Money
The main advantage of trading using opposite Lord Abbett and Cref Money positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lord Abbett position performs unexpectedly, Cref Money 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 Cref Money will offset losses from the drop in Cref Money's long position.| Lord Abbett vs. Needham Small Cap | Lord Abbett vs. Smallcap Growth Fund | Lord Abbett vs. Kinetics Small Cap | Lord Abbett vs. Pace Smallmedium Value |
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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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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