Correlation Between Loomis Sayles and Henderson European
Can any of the company-specific risk be diversified away by investing in both Loomis Sayles and Henderson European 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 Loomis Sayles and Henderson European into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Loomis Sayles Strategic and Henderson European Focus, you can compare the effects of market volatilities on Loomis Sayles and Henderson European 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 Loomis Sayles with a short position of Henderson European. Check out your portfolio center. Please also check ongoing floating volatility patterns of Loomis Sayles and Henderson European.
Diversification Opportunities for Loomis Sayles and Henderson European
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Loomis and Henderson is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Loomis Sayles Strategic and Henderson European Focus in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Henderson European Focus and Loomis Sayles 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 Loomis Sayles Strategic are associated (or correlated) with Henderson European. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Henderson European Focus has no effect on the direction of Loomis Sayles i.e., Loomis Sayles and Henderson European go up and down completely randomly.
Pair Corralation between Loomis Sayles and Henderson European
Assuming the 90 days horizon Loomis Sayles is expected to generate 4.51 times less return on investment than Henderson European. But when comparing it to its historical volatility, Loomis Sayles Strategic is 3.73 times less risky than Henderson European. It trades about 0.18 of its potential returns per unit of risk. Henderson European Focus is currently generating about 0.22 of returns per unit of risk over similar time horizon. If you would invest 4,725 in Henderson European Focus on November 28, 2024 and sell it today you would earn a total of 184.00 from holding Henderson European Focus or generate 3.89% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 95.45% |
| Values | Daily Returns |
Loomis Sayles Strategic vs. Henderson European Focus
Performance |
| Timeline |
| Loomis Sayles Strategic |
| Henderson European Focus |
Loomis Sayles and Henderson European Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Loomis Sayles and Henderson European
The main advantage of trading using opposite Loomis Sayles and Henderson European positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Loomis Sayles position performs unexpectedly, Henderson European 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 Henderson European will offset losses from the drop in Henderson European's long position.| Loomis Sayles vs. World Energy Fund | Loomis Sayles vs. Pimco Energy Tactical | Loomis Sayles vs. Oil Gas Ultrasector | Loomis Sayles vs. Clearbridge Energy Mlp |
| Henderson European vs. Henderson Global Equity | Henderson European vs. Loomis Sayles Strategic | Henderson European vs. First Eagle Overseas | Henderson European vs. Henderson European Focus |
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 CEOs Directory module to screen CEOs from public companies around the world.
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