Correlation Between Lord Abbett and Timothy Plan
Can any of the company-specific risk be diversified away by investing in both Lord Abbett and Timothy Plan 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 Timothy Plan into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lord Abbett Short and Timothy Plan International, you can compare the effects of market volatilities on Lord Abbett and Timothy Plan 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 Timothy Plan. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lord Abbett and Timothy Plan.
Diversification Opportunities for Lord Abbett and Timothy Plan
-0.04 | Correlation Coefficient |
Good diversification
The 3 months correlation between Lord and Timothy is -0.04. Overlapping area represents the amount of risk that can be diversified away by holding Lord Abbett Short and Timothy Plan International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Timothy Plan Interna 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 Short are associated (or correlated) with Timothy Plan. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Timothy Plan Interna has no effect on the direction of Lord Abbett i.e., Lord Abbett and Timothy Plan go up and down completely randomly.
Pair Corralation between Lord Abbett and Timothy Plan
Assuming the 90 days horizon Lord Abbett Short is expected to generate 0.24 times more return on investment than Timothy Plan. However, Lord Abbett Short is 4.13 times less risky than Timothy Plan. It trades about -0.36 of its potential returns per unit of risk. Timothy Plan International is currently generating about -0.3 per unit of risk. If you would invest 1,000.00 in Lord Abbett Short on October 9, 2024 and sell it today you would lose (12.00) from holding Lord Abbett Short or give up 1.2% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lord Abbett Short vs. Timothy Plan International
Performance |
| Timeline |
| Lord Abbett Short |
| Timothy Plan Interna |
Lord Abbett and Timothy Plan Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lord Abbett and Timothy Plan
The main advantage of trading using opposite Lord Abbett and Timothy Plan positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lord Abbett position performs unexpectedly, Timothy Plan 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 Timothy Plan will offset losses from the drop in Timothy Plan's 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 |
| Timothy Plan vs. Strategic Advisers Income | Timothy Plan vs. T Rowe Price | Timothy Plan vs. Simt High Yield | Timothy Plan vs. Virtus High Yield |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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