Correlation Between Leggmason Partners and Fs Managed
Can any of the company-specific risk be diversified away by investing in both Leggmason Partners and Fs Managed 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 Leggmason Partners and Fs Managed into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Leggmason Partners Institutional and Fs Managed Futures, you can compare the effects of market volatilities on Leggmason Partners and Fs Managed 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 Leggmason Partners with a short position of Fs Managed. Check out your portfolio center. Please also check ongoing floating volatility patterns of Leggmason Partners and Fs Managed.
Diversification Opportunities for Leggmason Partners and Fs Managed
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Leggmason and FMFFX is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Leggmason Partners Institution and Fs Managed Futures in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fs Managed Futures and Leggmason Partners 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 Leggmason Partners Institutional are associated (or correlated) with Fs Managed. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fs Managed Futures has no effect on the direction of Leggmason Partners i.e., Leggmason Partners and Fs Managed go up and down completely randomly.
Pair Corralation between Leggmason Partners and Fs Managed
Assuming the 90 days horizon Leggmason Partners Institutional is expected to generate 1.0 times more return on investment than Fs Managed. However, Leggmason Partners Institutional is 1.0 times less risky than Fs Managed. It trades about 0.02 of its potential returns per unit of risk. Fs Managed Futures is currently generating about -0.01 per unit of risk. If you would invest 95.00 in Leggmason Partners Institutional on September 12, 2024 and sell it today you would earn a total of 5.00 from holding Leggmason Partners Institutional or generate 5.26% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 91.8% |
| Values | Daily Returns |
Leggmason Partners Institution vs. Fs Managed Futures
Performance |
| Timeline |
| Leggmason Partners |
| Fs Managed Futures |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Good
Leggmason Partners and Fs Managed Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Leggmason Partners and Fs Managed
The main advantage of trading using opposite Leggmason Partners and Fs Managed positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Leggmason Partners position performs unexpectedly, Fs Managed 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 Fs Managed will offset losses from the drop in Fs Managed's long position.| Leggmason Partners vs. Siit Ultra Short | Leggmason Partners vs. Blackrock Short Term Inflat Protected | Leggmason Partners vs. Dreyfus Short Intermediate | Leggmason Partners vs. Astor Longshort Fund |
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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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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