Correlation Between Touchstone Large and Lazard Emerging
Can any of the company-specific risk be diversified away by investing in both Touchstone Large 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 Touchstone Large and Lazard Emerging into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Touchstone Large Cap and Lazard Emerging Markets, you can compare the effects of market volatilities on Touchstone Large 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 Touchstone Large with a short position of Lazard Emerging. Check out your portfolio center. Please also check ongoing floating volatility patterns of Touchstone Large and Lazard Emerging.
Diversification Opportunities for Touchstone Large and Lazard Emerging
-0.24 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Touchstone and Lazard is -0.24. Overlapping area represents the amount of risk that can be diversified away by holding Touchstone Large Cap 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 Touchstone Large 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 Touchstone Large Cap 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 Touchstone Large i.e., Touchstone Large and Lazard Emerging go up and down completely randomly.
Pair Corralation between Touchstone Large and Lazard Emerging
Assuming the 90 days horizon Touchstone Large Cap is expected to generate 0.59 times more return on investment than Lazard Emerging. However, Touchstone Large Cap is 1.7 times less risky than Lazard Emerging. It trades about -0.09 of its potential returns per unit of risk. Lazard Emerging Markets is currently generating about -0.06 per unit of risk. If you would invest 2,040 in Touchstone Large Cap on September 12, 2024 and sell it today you would lose (19.00) from holding Touchstone Large Cap or give up 0.93% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Touchstone Large Cap vs. Lazard Emerging Markets
Performance |
| Timeline |
| Touchstone Large Cap |
| Lazard Emerging Markets |
Touchstone Large and Lazard Emerging Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Touchstone Large and Lazard Emerging
The main advantage of trading using opposite Touchstone Large and Lazard Emerging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Touchstone Large 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.| Touchstone Large vs. Jhancock Disciplined Value | Touchstone Large vs. Fidelity Series 1000 | Touchstone Large vs. Dana Large Cap | Touchstone Large vs. Americafirst Large Cap |
| Lazard Emerging vs. Ab Select Equity | Lazard Emerging vs. Ab Fixed Income Shares | Lazard Emerging vs. Us Vector Equity | Lazard Emerging vs. Sarofim 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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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