Correlation Between Lord Abbett and Jensen Portfolio
Can any of the company-specific risk be diversified away by investing in both Lord Abbett and Jensen Portfolio 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 Jensen Portfolio into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lord Abbett Affiliated and The Jensen Portfolio, you can compare the effects of market volatilities on Lord Abbett and Jensen Portfolio 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 Jensen Portfolio. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lord Abbett and Jensen Portfolio.
Diversification Opportunities for Lord Abbett and Jensen Portfolio
-0.44 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Lord and Jensen is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding Lord Abbett Affiliated and The Jensen Portfolio in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jensen Portfolio 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 Affiliated are associated (or correlated) with Jensen Portfolio. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jensen Portfolio has no effect on the direction of Lord Abbett i.e., Lord Abbett and Jensen Portfolio go up and down completely randomly.
Pair Corralation between Lord Abbett and Jensen Portfolio
Assuming the 90 days horizon Lord Abbett Affiliated is expected to generate 0.53 times more return on investment than Jensen Portfolio. However, Lord Abbett Affiliated is 1.88 times less risky than Jensen Portfolio. It trades about 0.05 of its potential returns per unit of risk. The Jensen Portfolio is currently generating about -0.11 per unit of risk. If you would invest 1,995 in Lord Abbett Affiliated on September 1, 2024 and sell it today you would earn a total of 23.00 from holding Lord Abbett Affiliated or generate 1.15% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Lord Abbett Affiliated vs. The Jensen Portfolio
Performance |
| Timeline |
| Lord Abbett Affiliated |
| Jensen Portfolio |
Lord Abbett and Jensen Portfolio Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lord Abbett and Jensen Portfolio
The main advantage of trading using opposite Lord Abbett and Jensen Portfolio positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lord Abbett position performs unexpectedly, Jensen Portfolio 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 Jensen Portfolio will offset losses from the drop in Jensen Portfolio's long position.| Lord Abbett vs. Science Technology Fund | Lord Abbett vs. Janus Global Technology | Lord Abbett vs. Hennessy Technology Fund | Lord Abbett vs. Goldman Sachs Technology |
| Jensen Portfolio vs. Clipper Fund Inc | Jensen Portfolio vs. Parnassus E Equity | Jensen Portfolio vs. Mairs Power Growth | Jensen Portfolio vs. Sound Shore Fund |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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