Correlation Between Lazard Real and Lazard International
Can any of the company-specific risk be diversified away by investing in both Lazard Real and Lazard International 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 Lazard Real and Lazard International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lazard Real Assets and Lazard International Quality, you can compare the effects of market volatilities on Lazard Real and Lazard International 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 Lazard Real with a short position of Lazard International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lazard Real and Lazard International.
Diversification Opportunities for Lazard Real and Lazard International
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Lazard and Lazard is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Lazard Real Assets and Lazard International Quality in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lazard International and Lazard Real 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 Lazard Real Assets are associated (or correlated) with Lazard International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lazard International has no effect on the direction of Lazard Real i.e., Lazard Real and Lazard International go up and down completely randomly.
Pair Corralation between Lazard Real and Lazard International
Assuming the 90 days horizon Lazard Real is expected to generate 1.62 times less return on investment than Lazard International. But when comparing it to its historical volatility, Lazard Real Assets is 1.42 times less risky than Lazard International. It trades about 0.02 of its potential returns per unit of risk. Lazard International Quality is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 1,668 in Lazard International Quality on November 2, 2024 and sell it today you would earn a total of 34.00 from holding Lazard International Quality or generate 2.04% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lazard Real Assets vs. Lazard International Quality
Performance |
| Timeline |
| Lazard Real Assets |
| Lazard International |
Lazard Real and Lazard International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lazard Real and Lazard International
The main advantage of trading using opposite Lazard Real and Lazard International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lazard Real position performs unexpectedly, Lazard International 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 International will offset losses from the drop in Lazard International's long position.| Lazard Real vs. Morgan Stanley Emerging | Lazard Real vs. Growth Strategy Fund | Lazard Real vs. Pimco Moditiesplus Strategy | Lazard Real vs. Balanced Strategy Fund |
| Lazard International vs. Lazard Small Mid Cap | Lazard International vs. Lazard Equity Franchise | Lazard International vs. Lazard Emerging Markets | Lazard International vs. Lazard International Equity |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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