Correlation Between Loomis Sayles and Value Line
Can any of the company-specific risk be diversified away by investing in both Loomis Sayles and Value Line 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 Loomis Sayles and Value Line into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Loomis Sayles Global and Value Line Asset, you can compare the effects of market volatilities on Loomis Sayles and Value Line 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 Loomis Sayles with a short position of Value Line. Check out your portfolio center. Please also check ongoing floating volatility patterns of Loomis Sayles and Value Line.
Diversification Opportunities for Loomis Sayles and Value Line
0.77 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Loomis and Value is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding Loomis Sayles Global and Value Line Asset in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Value Line Asset and Loomis Sayles 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 Loomis Sayles Global are associated (or correlated) with Value Line. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Value Line Asset has no effect on the direction of Loomis Sayles i.e., Loomis Sayles and Value Line go up and down completely randomly.
Pair Corralation between Loomis Sayles and Value Line
Assuming the 90 days horizon Loomis Sayles is expected to generate 1.6 times less return on investment than Value Line. In addition to that, Loomis Sayles is 1.45 times more volatile than Value Line Asset. It trades about 0.05 of its total potential returns per unit of risk. Value Line Asset is currently generating about 0.11 per unit of volatility. If you would invest 3,404 in Value Line Asset on August 30, 2024 and sell it today you would earn a total of 1,296 from holding Value Line Asset or generate 38.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Loomis Sayles Global vs. Value Line Asset
Performance |
| Timeline |
| Loomis Sayles Global |
| Value Line Asset |
Loomis Sayles and Value Line Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Loomis Sayles and Value Line
The main advantage of trading using opposite Loomis Sayles and Value Line positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Loomis Sayles position performs unexpectedly, Value Line 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 Value Line will offset losses from the drop in Value Line's long position.| Loomis Sayles vs. Capital Income Builder | Loomis Sayles vs. Capital Income Builder | Loomis Sayles vs. Capital Income Builder | Loomis Sayles vs. HUMANA INC |
| Value Line vs. American Balanced Fund | Value Line vs. American Balanced Fund | Value Line vs. HUMANA INC | Value Line vs. Aquagold International |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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