Correlation Between Legg Mason and Eaton Vance
Can any of the company-specific risk be diversified away by investing in both Legg Mason and Eaton Vance 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 Legg Mason and Eaton Vance into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Legg Mason Partners and Eaton Vance Massachusetts, you can compare the effects of market volatilities on Legg Mason and Eaton Vance 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 Legg Mason with a short position of Eaton Vance. Check out your portfolio center. Please also check ongoing floating volatility patterns of Legg Mason and Eaton Vance.
Diversification Opportunities for Legg Mason and Eaton Vance
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Legg and Eaton is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Legg Mason Partners and Eaton Vance Massachusetts in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eaton Vance Massachusetts and Legg Mason 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 Legg Mason Partners are associated (or correlated) with Eaton Vance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eaton Vance Massachusetts has no effect on the direction of Legg Mason i.e., Legg Mason and Eaton Vance go up and down completely randomly.
Pair Corralation between Legg Mason and Eaton Vance
If you would invest 2,362 in Legg Mason Partners on September 3, 2024 and sell it today you would earn a total of 522.00 from holding Legg Mason Partners or generate 22.1% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
Legg Mason Partners vs. Eaton Vance Massachusetts
Performance |
| Timeline |
| Legg Mason Partners |
| Eaton Vance Massachusetts |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Legg Mason and Eaton Vance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Legg Mason and Eaton Vance
The main advantage of trading using opposite Legg Mason and Eaton Vance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Legg Mason position performs unexpectedly, Eaton Vance 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 Eaton Vance will offset losses from the drop in Eaton Vance's long position.| Legg Mason vs. Hennessy Nerstone Mid | Legg Mason vs. Fpa Queens Road | Legg Mason vs. American Century Etf | Legg Mason vs. Columbia Small Cap |
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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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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