Correlation Between Lord Abbett and Government Securities
Can any of the company-specific risk be diversified away by investing in both Lord Abbett and Government Securities 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 Government Securities into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lord Abbett Floating and Government Securities Fund, you can compare the effects of market volatilities on Lord Abbett and Government Securities 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 Government Securities. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lord Abbett and Government Securities.
Diversification Opportunities for Lord Abbett and Government Securities
0.18 | Correlation Coefficient |
Average diversification
The 3 months correlation between Lord and Government is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding Lord Abbett Floating and Government Securities Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Government Securities 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 Floating are associated (or correlated) with Government Securities. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Government Securities has no effect on the direction of Lord Abbett i.e., Lord Abbett and Government Securities go up and down completely randomly.
Pair Corralation between Lord Abbett and Government Securities
Assuming the 90 days horizon Lord Abbett is expected to generate 11.78 times less return on investment than Government Securities. But when comparing it to its historical volatility, Lord Abbett Floating is 1.73 times less risky than Government Securities. It trades about 0.04 of its potential returns per unit of risk. Government Securities Fund is currently generating about 0.28 of returns per unit of risk over similar time horizon. If you would invest 873.00 in Government Securities Fund on November 28, 2024 and sell it today you would earn a total of 13.00 from holding Government Securities Fund or generate 1.49% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lord Abbett Floating vs. Government Securities Fund
Performance |
| Timeline |
| Lord Abbett Floating |
| Government Securities |
Lord Abbett and Government Securities Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lord Abbett and Government Securities
The main advantage of trading using opposite Lord Abbett and Government Securities positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lord Abbett position performs unexpectedly, Government Securities 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 Government Securities will offset losses from the drop in Government Securities' long position.| Lord Abbett vs. Dodge Cox Stock | Lord Abbett vs. Tiaa Cref Large Cap Growth | Lord Abbett vs. Jpmorgan Large Cap | Lord Abbett vs. Wasatch Large Cap |
| Government Securities vs. T Rowe Price | Government Securities vs. Prudential Emerging Markets | Government Securities vs. Collegeadvantage 529 Savings | Government Securities vs. Hsbc Funds |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
Other Complementary Tools
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format | |
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
| Global Correlations Find global opportunities by holding instruments from different markets |