Correlation Between Legg Mason and Clearbridge Aggressive
Can any of the company-specific risk be diversified away by investing in both Legg Mason and Clearbridge Aggressive 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 Legg Mason and Clearbridge Aggressive into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Legg Mason Bw and Clearbridge Aggressive Growth, you can compare the effects of market volatilities on Legg Mason and Clearbridge Aggressive 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 Legg Mason with a short position of Clearbridge Aggressive. Check out your portfolio center. Please also check ongoing floating volatility patterns of Legg Mason and Clearbridge Aggressive.
Diversification Opportunities for Legg Mason and Clearbridge Aggressive
-0.44 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Legg and Clearbridge is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding Legg Mason Bw and Clearbridge Aggressive Growth in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Clearbridge Aggressive and Legg Mason 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 Legg Mason Bw are associated (or correlated) with Clearbridge Aggressive. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Clearbridge Aggressive has no effect on the direction of Legg Mason i.e., Legg Mason and Clearbridge Aggressive go up and down completely randomly.
Pair Corralation between Legg Mason and Clearbridge Aggressive
Assuming the 90 days horizon Legg Mason is expected to generate 3.25 times less return on investment than Clearbridge Aggressive. But when comparing it to its historical volatility, Legg Mason Bw is 4.99 times less risky than Clearbridge Aggressive. It trades about 0.12 of its potential returns per unit of risk. Clearbridge Aggressive Growth is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 10,768 in Clearbridge Aggressive Growth on September 1, 2024 and sell it today you would earn a total of 1,588 from holding Clearbridge Aggressive Growth or generate 14.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Legg Mason Bw vs. Clearbridge Aggressive Growth
Performance |
| Timeline |
| Legg Mason Bw |
| Clearbridge Aggressive |
Legg Mason and Clearbridge Aggressive Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Legg Mason and Clearbridge Aggressive
The main advantage of trading using opposite Legg Mason and Clearbridge Aggressive positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Legg Mason position performs unexpectedly, Clearbridge Aggressive 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 Clearbridge Aggressive will offset losses from the drop in Clearbridge Aggressive's long position.| Legg Mason vs. Clearbridge Aggressive Growth | Legg Mason vs. Clearbridge Small Cap | Legg Mason vs. Qs International Equity | Legg Mason vs. Clearbridge Appreciation Fund |
| Clearbridge Aggressive vs. Ab Value Fund | Clearbridge Aggressive vs. Fa 529 Aggressive | Clearbridge Aggressive vs. Leggmason Partners Institutional | Clearbridge Aggressive vs. Arrow Managed Futures |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
Other Complementary Tools
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Transaction History View history of all your transactions and understand their impact on performance | |
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins |