Correlation Between Lazard Us and Lazard International
Can any of the company-specific risk be diversified away by investing in both Lazard Us and Lazard International 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 Lazard Us and Lazard International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lazard Corporate Income and Lazard International Quality, you can compare the effects of market volatilities on Lazard Us and Lazard International 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 Lazard Us with a short position of Lazard International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lazard Us and Lazard International.
Diversification Opportunities for Lazard Us and Lazard International
0.33 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Lazard and Lazard is 0.33. Overlapping area represents the amount of risk that can be diversified away by holding Lazard Corporate Income and Lazard International Quality in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lazard International and Lazard Us 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 Lazard Corporate Income are associated (or correlated) with Lazard International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lazard International has no effect on the direction of Lazard Us i.e., Lazard Us and Lazard International go up and down completely randomly.
Pair Corralation between Lazard Us and Lazard International
Assuming the 90 days horizon Lazard Us is expected to generate 1.02 times less return on investment than Lazard International. But when comparing it to its historical volatility, Lazard Corporate Income is 4.6 times less risky than Lazard International. It trades about 0.24 of its potential returns per unit of risk. Lazard International Quality is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 1,573 in Lazard International Quality on August 28, 2024 and sell it today you would earn a total of 85.00 from holding Lazard International Quality or generate 5.4% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lazard Corporate Income vs. Lazard International Quality
Performance |
| Timeline |
| Lazard Corporate Income |
| Lazard International |
Lazard Us and Lazard International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lazard Us and Lazard International
The main advantage of trading using opposite Lazard Us and Lazard International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lazard Us position performs unexpectedly, Lazard International 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 Lazard International will offset losses from the drop in Lazard International's long position.| Lazard Us vs. Lazard Global Dynamic | Lazard Us vs. Lazard Global Dynamic | Lazard Us vs. Lazard International Quality | Lazard Us vs. Lazard Small Mid Cap |
| Lazard International vs. Lazard Global Dynamic | Lazard International vs. Lazard Global Dynamic | Lazard International vs. Lazard Small Mid Cap | Lazard International vs. Lazard Equity Franchise |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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