Correlation Between Lord Abbett and Ep Emerging
Can any of the company-specific risk be diversified away by investing in both Lord Abbett and Ep Emerging 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 Ep Emerging into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lord Abbett International and Ep Emerging Markets, you can compare the effects of market volatilities on Lord Abbett and Ep Emerging 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 Ep Emerging. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lord Abbett and Ep Emerging.
Diversification Opportunities for Lord Abbett and Ep Emerging
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Lord and EPEIX is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Lord Abbett International and Ep Emerging Markets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ep Emerging Markets 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 International are associated (or correlated) with Ep Emerging. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ep Emerging Markets has no effect on the direction of Lord Abbett i.e., Lord Abbett and Ep Emerging go up and down completely randomly.
Pair Corralation between Lord Abbett and Ep Emerging
Assuming the 90 days horizon Lord Abbett International is expected to generate 0.95 times more return on investment than Ep Emerging. However, Lord Abbett International is 1.05 times less risky than Ep Emerging. It trades about 0.05 of its potential returns per unit of risk. Ep Emerging Markets is currently generating about -0.19 per unit of risk. If you would invest 1,550 in Lord Abbett International on September 5, 2024 and sell it today you would earn a total of 11.00 from holding Lord Abbett International or generate 0.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lord Abbett International vs. Ep Emerging Markets
Performance |
| Timeline |
| Lord Abbett International |
| Ep Emerging Markets |
Lord Abbett and Ep Emerging Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lord Abbett and Ep Emerging
The main advantage of trading using opposite Lord Abbett and Ep Emerging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lord Abbett position performs unexpectedly, Ep Emerging 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 Ep Emerging will offset losses from the drop in Ep Emerging's long position.| Lord Abbett vs. Ep Emerging Markets | Lord Abbett vs. Mondrian Emerging Markets | Lord Abbett vs. Angel Oak Multi Strategy | Lord Abbett vs. T Rowe Price |
| Ep Emerging vs. Fidelity Advisor Health | Ep Emerging vs. Prudential Health Sciences | Ep Emerging vs. Tekla Healthcare Opportunities | Ep Emerging vs. Eventide Healthcare Life |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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