Correlation Between Jpmorgan Value and Lord Abbett
Can any of the company-specific risk be diversified away by investing in both Jpmorgan Value and Lord Abbett 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 Jpmorgan Value and Lord Abbett into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jpmorgan Value Advantage and Lord Abbett Affiliated, you can compare the effects of market volatilities on Jpmorgan Value and Lord Abbett 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 Jpmorgan Value with a short position of Lord Abbett. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jpmorgan Value and Lord Abbett.
Diversification Opportunities for Jpmorgan Value and Lord Abbett
0.99 | Correlation Coefficient |
No risk reduction
The 3 months correlation between Jpmorgan and Lord is 0.99. Overlapping area represents the amount of risk that can be diversified away by holding Jpmorgan Value Advantage and Lord Abbett Affiliated in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lord Abbett Affiliated and Jpmorgan Value 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 Jpmorgan Value Advantage are associated (or correlated) with Lord Abbett. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lord Abbett Affiliated has no effect on the direction of Jpmorgan Value i.e., Jpmorgan Value and Lord Abbett go up and down completely randomly.
Pair Corralation between Jpmorgan Value and Lord Abbett
Assuming the 90 days horizon Jpmorgan Value Advantage is expected to under-perform the Lord Abbett. In addition to that, Jpmorgan Value is 1.12 times more volatile than Lord Abbett Affiliated. It trades about -0.09 of its total potential returns per unit of risk. Lord Abbett Affiliated is currently generating about -0.08 per unit of volatility. If you would invest 1,802 in Lord Abbett Affiliated on January 17, 2024 and sell it today you would lose (22.00) from holding Lord Abbett Affiliated or give up 1.22% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jpmorgan Value Advantage vs. Lord Abbett Affiliated
Performance |
| Timeline |
| Jpmorgan Value Advantage |
| Lord Abbett Affiliated |
Jpmorgan Value and Lord Abbett Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jpmorgan Value and Lord Abbett
The main advantage of trading using opposite Jpmorgan Value and Lord Abbett positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jpmorgan Value position performs unexpectedly, Lord Abbett 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 Lord Abbett will offset losses from the drop in Lord Abbett's long position.| Jpmorgan Value vs. Jpmorgan Growth Advantage | Jpmorgan Value vs. Jpmorgan Equity Income | Jpmorgan Value vs. John Hancock Disciplined | Jpmorgan Value vs. Jpmorgan Mid Cap |
| Lord Abbett vs. Lord Abbett Trust | Lord Abbett vs. Lord Abbett Trust | Lord Abbett vs. Lord Abbett Focused | Lord Abbett vs. Floating Rate Fund |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
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