Correlation Between Lord Abbett and Keeley Small-mid
Can any of the company-specific risk be diversified away by investing in both Lord Abbett and Keeley Small-mid 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 Keeley Small-mid 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 Keeley Small Mid Cap, you can compare the effects of market volatilities on Lord Abbett and Keeley Small-mid 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 Keeley Small-mid. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lord Abbett and Keeley Small-mid.
Diversification Opportunities for Lord Abbett and Keeley Small-mid
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Lord and Keeley is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Lord Abbett Affiliated and Keeley Small Mid Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Keeley Small Mid 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 Keeley Small-mid. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Keeley Small Mid has no effect on the direction of Lord Abbett i.e., Lord Abbett and Keeley Small-mid go up and down completely randomly.
Pair Corralation between Lord Abbett and Keeley Small-mid
Assuming the 90 days horizon Lord Abbett is expected to generate 6.35 times less return on investment than Keeley Small-mid. In addition to that, Lord Abbett is 1.09 times more volatile than Keeley Small Mid Cap. It trades about 0.05 of its total potential returns per unit of risk. Keeley Small Mid Cap is currently generating about 0.35 per unit of volatility. If you would invest 996.00 in Keeley Small Mid Cap on September 1, 2024 and sell it today you would earn a total of 88.00 from holding Keeley Small Mid Cap or generate 8.84% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 95.45% |
| Values | Daily Returns |
Lord Abbett Affiliated vs. Keeley Small Mid Cap
Performance |
| Timeline |
| Lord Abbett Affiliated |
| Keeley Small Mid |
Lord Abbett and Keeley Small-mid Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lord Abbett and Keeley Small-mid
The main advantage of trading using opposite Lord Abbett and Keeley Small-mid positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lord Abbett position performs unexpectedly, Keeley Small-mid 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 Keeley Small-mid will offset losses from the drop in Keeley Small-mid'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 |
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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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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