Correlation Between Mesirow Financial and Lkcm Equity
Can any of the company-specific risk be diversified away by investing in both Mesirow Financial and Lkcm Equity 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 Mesirow Financial and Lkcm Equity into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mesirow Financial Small and Lkcm Equity Fund, you can compare the effects of market volatilities on Mesirow Financial and Lkcm Equity 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 Mesirow Financial with a short position of Lkcm Equity. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mesirow Financial and Lkcm Equity.
Diversification Opportunities for Mesirow Financial and Lkcm Equity
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Mesirow and Lkcm is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Mesirow Financial Small and Lkcm Equity Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lkcm Equity Fund and Mesirow Financial 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 Mesirow Financial Small are associated (or correlated) with Lkcm Equity. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lkcm Equity Fund has no effect on the direction of Mesirow Financial i.e., Mesirow Financial and Lkcm Equity go up and down completely randomly.
Pair Corralation between Mesirow Financial and Lkcm Equity
If you would invest 1,415 in Mesirow Financial Small on September 14, 2024 and sell it today you would earn a total of 5.00 from holding Mesirow Financial Small or generate 0.35% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Mesirow Financial Small vs. Lkcm Equity Fund
Performance |
| Timeline |
| Mesirow Financial Small |
| Lkcm Equity Fund |
Mesirow Financial and Lkcm Equity Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mesirow Financial and Lkcm Equity
The main advantage of trading using opposite Mesirow Financial and Lkcm Equity positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mesirow Financial position performs unexpectedly, Lkcm Equity 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 Lkcm Equity will offset losses from the drop in Lkcm Equity's long position.| Mesirow Financial vs. Lord Abbett Inflation | Mesirow Financial vs. Arrow Managed Futures | Mesirow Financial vs. Fidelity Sai Inflationfocused | Mesirow Financial vs. Short Duration Inflation |
| Lkcm Equity vs. Blackrock Financial Institutions | Lkcm Equity vs. Prudential Jennison Financial | Lkcm Equity vs. John Hancock Financial | Lkcm Equity vs. Mesirow Financial Small |
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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.
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