Correlation Between Praxis Growth and Lord Abbett
Can any of the company-specific risk be diversified away by investing in both Praxis Growth and Lord Abbett 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 Praxis Growth and Lord Abbett into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Praxis Growth Index and Lord Abbett Short, you can compare the effects of market volatilities on Praxis Growth and Lord Abbett 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 Praxis Growth with a short position of Lord Abbett. Check out your portfolio center. Please also check ongoing floating volatility patterns of Praxis Growth and Lord Abbett.
Diversification Opportunities for Praxis Growth and Lord Abbett
-0.02 | Correlation Coefficient |
Good diversification
The 3 months correlation between Praxis and Lord is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding Praxis Growth Index and Lord Abbett Short in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lord Abbett Short and Praxis Growth 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 Praxis Growth Index are associated (or correlated) with Lord Abbett. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lord Abbett Short has no effect on the direction of Praxis Growth i.e., Praxis Growth and Lord Abbett go up and down completely randomly.
Pair Corralation between Praxis Growth and Lord Abbett
Assuming the 90 days horizon Praxis Growth Index is expected to generate 6.16 times more return on investment than Lord Abbett. However, Praxis Growth is 6.16 times more volatile than Lord Abbett Short. It trades about 0.11 of its potential returns per unit of risk. Lord Abbett Short is currently generating about 0.13 per unit of risk. If you would invest 4,830 in Praxis Growth Index on August 29, 2024 and sell it today you would earn a total of 118.00 from holding Praxis Growth Index or generate 2.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Praxis Growth Index vs. Lord Abbett Short
Performance |
| Timeline |
| Praxis Growth Index |
| Lord Abbett Short |
Praxis Growth and Lord Abbett Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Praxis Growth and Lord Abbett
The main advantage of trading using opposite Praxis Growth and Lord Abbett positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Praxis Growth position performs unexpectedly, Lord Abbett 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 Lord Abbett will offset losses from the drop in Lord Abbett's long position.| Praxis Growth vs. Praxis Small Cap | Praxis Growth vs. Praxis Small Cap | Praxis Growth vs. Praxis International Index | Praxis Growth vs. Praxis Value Index |
| Lord Abbett vs. Small Pany Growth | Lord Abbett vs. Rational Defensive Growth | Lord Abbett vs. L Abbett Growth | Lord Abbett vs. Praxis Growth Index |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
Other Complementary Tools
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine |