Correlation Between Lkcm Equity and Lkcm International
Can any of the company-specific risk be diversified away by investing in both Lkcm Equity and Lkcm International 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 Lkcm Equity and Lkcm International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lkcm Equity Fund and Lkcm International Equity, you can compare the effects of market volatilities on Lkcm Equity and Lkcm International 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 Lkcm Equity with a short position of Lkcm International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lkcm Equity and Lkcm International.
Diversification Opportunities for Lkcm Equity and Lkcm International
-0.28 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Lkcm and Lkcm is -0.28. Overlapping area represents the amount of risk that can be diversified away by holding Lkcm Equity Fund and Lkcm International Equity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lkcm International Equity and Lkcm Equity 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 Lkcm Equity Fund are associated (or correlated) with Lkcm International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lkcm International Equity has no effect on the direction of Lkcm Equity i.e., Lkcm Equity and Lkcm International go up and down completely randomly.
Pair Corralation between Lkcm Equity and Lkcm International
Assuming the 90 days horizon Lkcm Equity Fund is expected to generate 1.23 times more return on investment than Lkcm International. However, Lkcm Equity is 1.23 times more volatile than Lkcm International Equity. It trades about 0.2 of its potential returns per unit of risk. Lkcm International Equity is currently generating about -0.11 per unit of risk. If you would invest 3,994 in Lkcm Equity Fund on August 26, 2024 and sell it today you would earn a total of 166.00 from holding Lkcm Equity Fund or generate 4.16% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lkcm Equity Fund vs. Lkcm International Equity
Performance |
| Timeline |
| Lkcm Equity Fund |
| Lkcm International Equity |
Lkcm Equity and Lkcm International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lkcm Equity and Lkcm International
The main advantage of trading using opposite Lkcm Equity and Lkcm International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lkcm Equity position performs unexpectedly, Lkcm International 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 Lkcm International will offset losses from the drop in Lkcm International's long position.| Lkcm Equity vs. Prudential Core Conservative | Lkcm Equity vs. Blackrock Conservative Prprdptfinstttnl | Lkcm Equity vs. Huber Capital Diversified | Lkcm Equity vs. Fidelity Advisor Diversified |
| Lkcm International vs. Lkcm Aquinas Catholic | Lkcm International vs. Lkcm Balanced Fund | Lkcm International vs. Lkcm Equity Fund | Lkcm International vs. Lkcm Fixed Income |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
Other Complementary Tools
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. | |
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio |