Correlation Between Aqr Diversified and Lazard Us
Can any of the company-specific risk be diversified away by investing in both Aqr Diversified and Lazard Us 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 Aqr Diversified and Lazard Us into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aqr Diversified Arbitrage and Lazard Small Mid Cap, you can compare the effects of market volatilities on Aqr Diversified and Lazard Us 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 Aqr Diversified with a short position of Lazard Us. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aqr Diversified and Lazard Us.
Diversification Opportunities for Aqr Diversified and Lazard Us
-0.69 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Aqr and Lazard is -0.69. Overlapping area represents the amount of risk that can be diversified away by holding Aqr Diversified Arbitrage and Lazard Small Mid Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lazard Small Mid and Aqr Diversified 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 Aqr Diversified Arbitrage are associated (or correlated) with Lazard Us. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lazard Small Mid has no effect on the direction of Aqr Diversified i.e., Aqr Diversified and Lazard Us go up and down completely randomly.
Pair Corralation between Aqr Diversified and Lazard Us
Assuming the 90 days horizon Aqr Diversified Arbitrage is expected to generate 0.07 times more return on investment than Lazard Us. However, Aqr Diversified Arbitrage is 15.37 times less risky than Lazard Us. It trades about 0.39 of its potential returns per unit of risk. Lazard Small Mid Cap is currently generating about -0.19 per unit of risk. If you would invest 1,204 in Aqr Diversified Arbitrage on December 1, 2024 and sell it today you would earn a total of 31.00 from holding Aqr Diversified Arbitrage or generate 2.57% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aqr Diversified Arbitrage vs. Lazard Small Mid Cap
Performance |
| Timeline |
| Aqr Diversified Arbitrage |
| Lazard Small Mid |
Aqr Diversified and Lazard Us Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aqr Diversified and Lazard Us
The main advantage of trading using opposite Aqr Diversified and Lazard Us positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aqr Diversified position performs unexpectedly, Lazard Us 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 Us will offset losses from the drop in Lazard Us' long position.| Aqr Diversified vs. Doubleline Emerging Markets | ||
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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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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