Correlation Between Lord Abbett and Investment Managers
Can any of the company-specific risk be diversified away by investing in both Lord Abbett and Investment Managers 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 Investment Managers into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lord Abbett Small and Investment Managers Series, you can compare the effects of market volatilities on Lord Abbett and Investment Managers 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 Investment Managers. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lord Abbett and Investment Managers.
Diversification Opportunities for Lord Abbett and Investment Managers
0.75 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Lord and Investment is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding Lord Abbett Small and Investment Managers Series in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Investment Managers 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 Small are associated (or correlated) with Investment Managers. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Investment Managers has no effect on the direction of Lord Abbett i.e., Lord Abbett and Investment Managers go up and down completely randomly.
Pair Corralation between Lord Abbett and Investment Managers
Assuming the 90 days horizon Lord Abbett Small is expected to generate 2.38 times more return on investment than Investment Managers. However, Lord Abbett is 2.38 times more volatile than Investment Managers Series. It trades about 0.31 of its potential returns per unit of risk. Investment Managers Series is currently generating about 0.09 per unit of risk. If you would invest 2,222 in Lord Abbett Small on August 26, 2024 and sell it today you would earn a total of 255.00 from holding Lord Abbett Small or generate 11.48% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lord Abbett Small vs. Investment Managers Series
Performance |
| Timeline |
| Lord Abbett Small |
| Investment Managers |
Lord Abbett and Investment Managers Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lord Abbett and Investment Managers
The main advantage of trading using opposite Lord Abbett and Investment Managers positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lord Abbett position performs unexpectedly, Investment Managers 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 Investment Managers will offset losses from the drop in Investment Managers' long position.| Lord Abbett vs. Lord Abbett Trust | Lord Abbett vs. Lord Abbett Trust | Lord Abbett vs. Lord Abbett Focused | Lord Abbett vs. Floating Rate Fund |
| Investment Managers vs. Mid Cap Value Profund | Investment Managers vs. Fidelity Small Cap | Investment Managers vs. Lord Abbett Small | Investment Managers vs. American Century Etf |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
Other Complementary Tools
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance |