Correlation Between Scharf Fund and Lazard Capital
Can any of the company-specific risk be diversified away by investing in both Scharf Fund and Lazard Capital 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 Scharf Fund and Lazard Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Scharf Fund Retail and Lazard Capital Allocator, you can compare the effects of market volatilities on Scharf Fund and Lazard Capital 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 Scharf Fund with a short position of Lazard Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Scharf Fund and Lazard Capital.
Diversification Opportunities for Scharf Fund and Lazard Capital
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Scharf and Lazard is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Scharf Fund Retail and Lazard Capital Allocator in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lazard Capital Allocator and Scharf Fund 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 Scharf Fund Retail are associated (or correlated) with Lazard Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lazard Capital Allocator has no effect on the direction of Scharf Fund i.e., Scharf Fund and Lazard Capital go up and down completely randomly.
Pair Corralation between Scharf Fund and Lazard Capital
Assuming the 90 days horizon Scharf Fund is expected to generate 1.03 times less return on investment than Lazard Capital. But when comparing it to its historical volatility, Scharf Fund Retail is 1.24 times less risky than Lazard Capital. It trades about 0.08 of its potential returns per unit of risk. Lazard Capital Allocator is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 1,011 in Lazard Capital Allocator on September 14, 2024 and sell it today you would earn a total of 122.00 from holding Lazard Capital Allocator or generate 12.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Scharf Fund Retail vs. Lazard Capital Allocator
Performance |
| Timeline |
| Scharf Fund Retail |
| Lazard Capital Allocator |
Scharf Fund and Lazard Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Scharf Fund and Lazard Capital
The main advantage of trading using opposite Scharf Fund and Lazard Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Scharf Fund position performs unexpectedly, Lazard Capital 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 Lazard Capital will offset losses from the drop in Lazard Capital's long position.| Scharf Fund vs. Scharf Global Opportunity | Scharf Fund vs. Scharf Balanced Opportunity | Scharf Fund vs. Scharf Balanced Opportunity | Scharf Fund vs. American Funds 2060 |
| Lazard Capital vs. Nuveen Municipal High | Lazard Capital vs. Western Asset High | Lazard Capital vs. Ab High Income | Lazard Capital vs. Fa 529 Aggressive |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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