Correlation Between Templeton Growth and Lazard Emerging
Can any of the company-specific risk be diversified away by investing in both Templeton Growth and Lazard Emerging 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 Templeton Growth and Lazard Emerging into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Templeton Growth Fund and Lazard Emerging Markets, you can compare the effects of market volatilities on Templeton Growth and Lazard Emerging 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 Templeton Growth with a short position of Lazard Emerging. Check out your portfolio center. Please also check ongoing floating volatility patterns of Templeton Growth and Lazard Emerging.
Diversification Opportunities for Templeton Growth and Lazard Emerging
0.46 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Templeton and Lazard is 0.46. Overlapping area represents the amount of risk that can be diversified away by holding Templeton Growth Fund and Lazard Emerging Markets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lazard Emerging Markets and Templeton Growth 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 Templeton Growth Fund are associated (or correlated) with Lazard Emerging. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lazard Emerging Markets has no effect on the direction of Templeton Growth i.e., Templeton Growth and Lazard Emerging go up and down completely randomly.
Pair Corralation between Templeton Growth and Lazard Emerging
Assuming the 90 days horizon Templeton Growth is expected to generate 1.12 times less return on investment than Lazard Emerging. But when comparing it to its historical volatility, Templeton Growth Fund is 1.04 times less risky than Lazard Emerging. It trades about 0.07 of its potential returns per unit of risk. Lazard Emerging Markets is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 1,412 in Lazard Emerging Markets on September 3, 2024 and sell it today you would earn a total of 460.00 from holding Lazard Emerging Markets or generate 32.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Templeton Growth Fund vs. Lazard Emerging Markets
Performance |
| Timeline |
| Templeton Growth |
| Lazard Emerging Markets |
Templeton Growth and Lazard Emerging Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Templeton Growth and Lazard Emerging
The main advantage of trading using opposite Templeton Growth and Lazard Emerging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Templeton Growth position performs unexpectedly, Lazard Emerging 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 Emerging will offset losses from the drop in Lazard Emerging's long position.| Templeton Growth vs. Boston Partners Small | Templeton Growth vs. American Century Etf | Templeton Growth vs. Fpa Queens Road | Templeton Growth vs. Ultrasmall Cap Profund Ultrasmall Cap |
| Lazard Emerging vs. Franklin Mutual Global | Lazard Emerging vs. Templeton Growth Fund | Lazard Emerging vs. Franklin Real Estate | Lazard Emerging vs. HUMANA INC |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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