Correlation Between Lazard Strategic and Profunds-large Cap
Can any of the company-specific risk be diversified away by investing in both Lazard Strategic and Profunds-large Cap 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 Strategic and Profunds-large Cap into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lazard Strategic Equity and Profunds Large Cap Growth, you can compare the effects of market volatilities on Lazard Strategic and Profunds-large Cap 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 Strategic with a short position of Profunds-large Cap. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lazard Strategic and Profunds-large Cap.
Diversification Opportunities for Lazard Strategic and Profunds-large Cap
-0.14 | Correlation Coefficient |
Good diversification
The 3 months correlation between Lazard and Profunds-large is -0.14. Overlapping area represents the amount of risk that can be diversified away by holding Lazard Strategic Equity and Profunds Large Cap Growth in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Profunds Large Cap and Lazard Strategic 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 Strategic Equity are associated (or correlated) with Profunds-large Cap. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Profunds Large Cap has no effect on the direction of Lazard Strategic i.e., Lazard Strategic and Profunds-large Cap go up and down completely randomly.
Pair Corralation between Lazard Strategic and Profunds-large Cap
Assuming the 90 days horizon Lazard Strategic Equity is expected to under-perform the Profunds-large Cap. But the mutual fund apears to be less risky and, when comparing its historical volatility, Lazard Strategic Equity is 1.01 times less risky than Profunds-large Cap. The mutual fund trades about -0.36 of its potential returns per unit of risk. The Profunds Large Cap Growth is currently generating about -0.18 of returns per unit of risk over similar time horizon. If you would invest 3,654 in Profunds Large Cap Growth on October 16, 2024 and sell it today you would lose (164.00) from holding Profunds Large Cap Growth or give up 4.49% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lazard Strategic Equity vs. Profunds Large Cap Growth
Performance |
| Timeline |
| Lazard Strategic Equity |
| Profunds Large Cap |
Lazard Strategic and Profunds-large Cap Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lazard Strategic and Profunds-large Cap
The main advantage of trading using opposite Lazard Strategic and Profunds-large Cap positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lazard Strategic position performs unexpectedly, Profunds-large Cap 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 Profunds-large Cap will offset losses from the drop in Profunds-large Cap's long position.| Lazard Strategic vs. Profunds Large Cap Growth | Lazard Strategic vs. Fundamental Large Cap | Lazard Strategic vs. Qs Large Cap | Lazard Strategic vs. Large Cap Growth Profund |
| Profunds-large Cap vs. Ab High Income | Profunds-large Cap vs. Multi Manager High Yield | Profunds-large Cap vs. Aqr Risk Parity | Profunds-large Cap vs. Inverse High Yield |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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