Correlation Between Lazard Emerging and Thrivent High
Can any of the company-specific risk be diversified away by investing in both Lazard Emerging and Thrivent High 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 Lazard Emerging and Thrivent High into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lazard Emerging Markets and Thrivent High Yield, you can compare the effects of market volatilities on Lazard Emerging and Thrivent High 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 Lazard Emerging with a short position of Thrivent High. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lazard Emerging and Thrivent High.
Diversification Opportunities for Lazard Emerging and Thrivent High
0.51 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Lazard and Thrivent is 0.51. Overlapping area represents the amount of risk that can be diversified away by holding Lazard Emerging Markets and Thrivent High Yield in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Thrivent High Yield and Lazard Emerging 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 Lazard Emerging Markets are associated (or correlated) with Thrivent High. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Thrivent High Yield has no effect on the direction of Lazard Emerging i.e., Lazard Emerging and Thrivent High go up and down completely randomly.
Pair Corralation between Lazard Emerging and Thrivent High
Assuming the 90 days horizon Lazard Emerging Markets is expected to generate 3.1 times more return on investment than Thrivent High. However, Lazard Emerging is 3.1 times more volatile than Thrivent High Yield. It trades about 0.06 of its potential returns per unit of risk. Thrivent High Yield is currently generating about 0.13 per unit of risk. If you would invest 1,016 in Lazard Emerging Markets on August 26, 2024 and sell it today you would earn a total of 196.00 from holding Lazard Emerging Markets or generate 19.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lazard Emerging Markets vs. Thrivent High Yield
Performance |
| Timeline |
| Lazard Emerging Markets |
| Thrivent High Yield |
Lazard Emerging and Thrivent High Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lazard Emerging and Thrivent High
The main advantage of trading using opposite Lazard Emerging and Thrivent High positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lazard Emerging position performs unexpectedly, Thrivent High 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 Thrivent High will offset losses from the drop in Thrivent High's long position.The idea behind Lazard Emerging Markets and Thrivent High Yield pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Thrivent High vs. Thrivent Limited Maturity | Thrivent High vs. Thrivent Income Fund | Thrivent High vs. Thrivent Large Cap | Thrivent High vs. Thrivent Large Cap |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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