Correlation Between Pear Tree and Lazard Global
Can any of the company-specific risk be diversified away by investing in both Pear Tree and Lazard Global 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 Pear Tree and Lazard Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Pear Tree Polaris and Lazard Global Listed, you can compare the effects of market volatilities on Pear Tree and Lazard Global 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 Pear Tree with a short position of Lazard Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pear Tree and Lazard Global.
Diversification Opportunities for Pear Tree and Lazard Global
0.44 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Pear and Lazard is 0.44. Overlapping area represents the amount of risk that can be diversified away by holding Pear Tree Polaris and Lazard Global Listed in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lazard Global Listed and Pear Tree 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 Pear Tree Polaris are associated (or correlated) with Lazard Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lazard Global Listed has no effect on the direction of Pear Tree i.e., Pear Tree and Lazard Global go up and down completely randomly.
Pair Corralation between Pear Tree and Lazard Global
Assuming the 90 days horizon Pear Tree Polaris is expected to under-perform the Lazard Global. In addition to that, Pear Tree is 1.29 times more volatile than Lazard Global Listed. It trades about -0.17 of its total potential returns per unit of risk. Lazard Global Listed is currently generating about 0.04 per unit of volatility. If you would invest 1,611 in Lazard Global Listed on August 31, 2024 and sell it today you would earn a total of 23.00 from holding Lazard Global Listed or generate 1.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Pear Tree Polaris vs. Lazard Global Listed
Performance |
| Timeline |
| Pear Tree Polaris |
| Lazard Global Listed |
Pear Tree and Lazard Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pear Tree and Lazard Global
The main advantage of trading using opposite Pear Tree and Lazard Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pear Tree position performs unexpectedly, Lazard Global 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 Global will offset losses from the drop in Lazard Global's long position.| Pear Tree vs. Pear Tree Polaris | Pear Tree vs. Pear Tree Polaris | Pear Tree vs. Artisan International Value | Pear Tree vs. Rondure New World |
| Lazard Global vs. International Fund International | Lazard Global vs. Lazard Global Listed | Lazard Global vs. Large Cap Growth | Lazard Global vs. Parnassus Endeavor Fund |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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