Correlation Between Lord Abbett and Pear Tree
Can any of the company-specific risk be diversified away by investing in both Lord Abbett and Pear Tree 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 Pear Tree into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lord Abbett Emerging and Pear Tree Essex, you can compare the effects of market volatilities on Lord Abbett and Pear Tree 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 Pear Tree. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lord Abbett and Pear Tree.
Diversification Opportunities for Lord Abbett and Pear Tree
0.24 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Lord and Pear is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding Lord Abbett Emerging and Pear Tree Essex in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pear Tree Essex 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 Emerging are associated (or correlated) with Pear Tree. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pear Tree Essex has no effect on the direction of Lord Abbett i.e., Lord Abbett and Pear Tree go up and down completely randomly.
Pair Corralation between Lord Abbett and Pear Tree
Assuming the 90 days horizon Lord Abbett is expected to generate 3.61 times less return on investment than Pear Tree. But when comparing it to its historical volatility, Lord Abbett Emerging is 5.89 times less risky than Pear Tree. It trades about 0.18 of its potential returns per unit of risk. Pear Tree Essex is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 614.00 in Pear Tree Essex on November 3, 2024 and sell it today you would earn a total of 20.00 from holding Pear Tree Essex or generate 3.26% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lord Abbett Emerging vs. Pear Tree Essex
Performance |
| Timeline |
| Lord Abbett Emerging |
| Pear Tree Essex |
Lord Abbett and Pear Tree Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lord Abbett and Pear Tree
The main advantage of trading using opposite Lord Abbett and Pear Tree positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lord Abbett position performs unexpectedly, Pear Tree 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 Pear Tree will offset losses from the drop in Pear Tree's long position.| Lord Abbett vs. Lord Abbett Intermediate | Lord Abbett vs. Lord Abbett Trust | Lord Abbett vs. Lord Abbett Trust | Lord Abbett vs. Lord Abbett Focused |
| Pear Tree vs. Nuveen Core Equity | Pear Tree vs. Gmo Global Equity | Pear Tree vs. The Growth Equity | Pear Tree vs. Gmo International Equity |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
Other Complementary Tools
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios |