Correlation Between Lazard Real and Lazard Strategic
Can any of the company-specific risk be diversified away by investing in both Lazard Real and Lazard Strategic 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 Strategic 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 Strategic Equity, you can compare the effects of market volatilities on Lazard Real and Lazard Strategic 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 Strategic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lazard Real and Lazard Strategic.
Diversification Opportunities for Lazard Real and Lazard Strategic
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Lazard and Lazard is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Lazard Real Assets and Lazard Strategic Equity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lazard Strategic Equity 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 Strategic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lazard Strategic Equity has no effect on the direction of Lazard Real i.e., Lazard Real and Lazard Strategic go up and down completely randomly.
Pair Corralation between Lazard Real and Lazard Strategic
Assuming the 90 days horizon Lazard Real is expected to generate 2.88 times less return on investment than Lazard Strategic. But when comparing it to its historical volatility, Lazard Real Assets is 1.29 times less risky than Lazard Strategic. It trades about 0.03 of its potential returns per unit of risk. Lazard Strategic Equity is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 1,334 in Lazard Strategic Equity on October 13, 2024 and sell it today you would earn a total of 300.00 from holding Lazard Strategic Equity or generate 22.49% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.8% |
| Values | Daily Returns |
Lazard Real Assets vs. Lazard Strategic Equity
Performance |
| Timeline |
| Lazard Real Assets |
| Lazard Strategic Equity |
Lazard Real and Lazard Strategic Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lazard Real and Lazard Strategic
The main advantage of trading using opposite Lazard Real and Lazard Strategic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lazard Real position performs unexpectedly, Lazard Strategic 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 Strategic will offset losses from the drop in Lazard Strategic's long position.| Lazard Real vs. Hennessy Bp Energy | Lazard Real vs. Thrivent Natural Resources | Lazard Real vs. Jennison Natural Resources | Lazard Real vs. Transamerica Mlp Energy |
| Lazard Strategic vs. Lazard International Quality | Lazard Strategic vs. Lazard Small Mid Cap | Lazard Strategic vs. Lazard Equity Franchise | Lazard Strategic vs. Lazard Emerging Markets |
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 Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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