Correlation Between Energy Services and Loomis Sayles
Can any of the company-specific risk be diversified away by investing in both Energy Services and Loomis Sayles 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 Energy Services and Loomis Sayles into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Energy Services Fund and Loomis Sayles Inflation, you can compare the effects of market volatilities on Energy Services and Loomis Sayles 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 Energy Services with a short position of Loomis Sayles. Check out your portfolio center. Please also check ongoing floating volatility patterns of Energy Services and Loomis Sayles.
Diversification Opportunities for Energy Services and Loomis Sayles
0.14 | Correlation Coefficient |
Average diversification
The 3 months correlation between Energy and Loomis is 0.14. Overlapping area represents the amount of risk that can be diversified away by holding Energy Services Fund and Loomis Sayles Inflation in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Loomis Sayles Inflation and Energy Services 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 Energy Services Fund are associated (or correlated) with Loomis Sayles. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Loomis Sayles Inflation has no effect on the direction of Energy Services i.e., Energy Services and Loomis Sayles go up and down completely randomly.
Pair Corralation between Energy Services and Loomis Sayles
Assuming the 90 days horizon Energy Services Fund is expected to generate 5.1 times more return on investment than Loomis Sayles. However, Energy Services is 5.1 times more volatile than Loomis Sayles Inflation. It trades about 0.01 of its potential returns per unit of risk. Loomis Sayles Inflation is currently generating about 0.03 per unit of risk. If you would invest 21,711 in Energy Services Fund on November 27, 2024 and sell it today you would earn a total of 476.00 from holding Energy Services Fund or generate 2.19% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Energy Services Fund vs. Loomis Sayles Inflation
Performance |
| Timeline |
| Energy Services |
| Loomis Sayles Inflation |
Energy Services and Loomis Sayles Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Energy Services and Loomis Sayles
The main advantage of trading using opposite Energy Services and Loomis Sayles positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Energy Services position performs unexpectedly, Loomis Sayles 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 Loomis Sayles will offset losses from the drop in Loomis Sayles' long position.| Energy Services vs. Energy Fund Investor | Energy Services vs. Basic Materials Fund | Energy Services vs. Electronics Fund Investor | Energy Services vs. Health Care Fund |
| Loomis Sayles vs. Loomis Sayles Inflation | Loomis Sayles vs. Loomis Sayles Bond | Loomis Sayles vs. Loomis Sayles Bond | Loomis Sayles vs. Loomis Sayles Bond |
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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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