Correlation Between Lord Abbett and Multi-manager High
Can any of the company-specific risk be diversified away by investing in both Lord Abbett and Multi-manager High 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 Multi-manager High into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lord Abbett Intermediate and Multi Manager High Yield, you can compare the effects of market volatilities on Lord Abbett and Multi-manager High 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 Multi-manager High. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lord Abbett and Multi-manager High.
Diversification Opportunities for Lord Abbett and Multi-manager High
0.55 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Lord and Multi-manager is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding Lord Abbett Intermediate and Multi Manager High Yield in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Multi Manager High 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 Intermediate are associated (or correlated) with Multi-manager High. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Multi Manager High has no effect on the direction of Lord Abbett i.e., Lord Abbett and Multi-manager High go up and down completely randomly.
Pair Corralation between Lord Abbett and Multi-manager High
Assuming the 90 days horizon Lord Abbett Intermediate is expected to under-perform the Multi-manager High. In addition to that, Lord Abbett is 1.34 times more volatile than Multi Manager High Yield. It trades about -0.33 of its total potential returns per unit of risk. Multi Manager High Yield is currently generating about -0.11 per unit of volatility. If you would invest 844.00 in Multi Manager High Yield on October 11, 2024 and sell it today you would lose (3.00) from holding Multi Manager High Yield or give up 0.36% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.24% |
| Values | Daily Returns |
Lord Abbett Intermediate vs. Multi Manager High Yield
Performance |
| Timeline |
| Lord Abbett Intermediate |
| Multi Manager High |
Lord Abbett and Multi-manager High Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lord Abbett and Multi-manager High
The main advantage of trading using opposite Lord Abbett and Multi-manager High positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lord Abbett position performs unexpectedly, Multi-manager High 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 Multi-manager High will offset losses from the drop in Multi-manager High's long position.| Lord Abbett vs. Financials Ultrasector Profund | Lord Abbett vs. Blackrock Financial Institutions | Lord Abbett vs. Rmb Mendon Financial | Lord Abbett vs. Blackstone Secured Lending |
| Multi-manager High vs. Legg Mason Global | Multi-manager High vs. Mirova Global Green | Multi-manager High vs. Alliancebernstein Global Highome | Multi-manager High vs. Artisan Global Opportunities |
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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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