Correlation Between Multisector Bond and Loomis Sayles
Can any of the company-specific risk be diversified away by investing in both Multisector Bond and Loomis Sayles 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 Multisector Bond and Loomis Sayles into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Multisector Bond Sma and Loomis Sayles Small, you can compare the effects of market volatilities on Multisector Bond and Loomis Sayles 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 Multisector Bond with a short position of Loomis Sayles. Check out your portfolio center. Please also check ongoing floating volatility patterns of Multisector Bond and Loomis Sayles.
Diversification Opportunities for Multisector Bond and Loomis Sayles
0.09 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Multisector and Loomis is 0.09. Overlapping area represents the amount of risk that can be diversified away by holding Multisector Bond Sma and Loomis Sayles Small in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Loomis Sayles Small and Multisector Bond 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 Multisector Bond Sma are associated (or correlated) with Loomis Sayles. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Loomis Sayles Small has no effect on the direction of Multisector Bond i.e., Multisector Bond and Loomis Sayles go up and down completely randomly.
Pair Corralation between Multisector Bond and Loomis Sayles
Assuming the 90 days horizon Multisector Bond Sma is expected to under-perform the Loomis Sayles. But the mutual fund apears to be less risky and, when comparing its historical volatility, Multisector Bond Sma is 4.27 times less risky than Loomis Sayles. The mutual fund trades about -0.04 of its potential returns per unit of risk. The Loomis Sayles Small is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest 2,131 in Loomis Sayles Small on August 30, 2024 and sell it today you would earn a total of 176.00 from holding Loomis Sayles Small or generate 8.26% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 97.73% |
| Values | Daily Returns |
Multisector Bond Sma vs. Loomis Sayles Small
Performance |
| Timeline |
| Multisector Bond Sma |
| Loomis Sayles Small |
Multisector Bond and Loomis Sayles Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Multisector Bond and Loomis Sayles
The main advantage of trading using opposite Multisector Bond and Loomis Sayles positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Multisector Bond position performs unexpectedly, Loomis Sayles 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 Loomis Sayles will offset losses from the drop in Loomis Sayles' long position.| Multisector Bond vs. Columbia Porate Income | Multisector Bond vs. Columbia Ultra Short | Multisector Bond vs. Columbia Treasury Index | Multisector Bond vs. Columbia Small Cap |
| Loomis Sayles vs. Multisector Bond Sma | Loomis Sayles vs. Mesirow Financial Small | Loomis Sayles vs. Angel Oak Financial | Loomis Sayles vs. T Rowe Price |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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