Correlation Between Freeport McMoran and Lord Abbett
Can any of the company-specific risk be diversified away by investing in both Freeport McMoran 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 Freeport McMoran and Lord Abbett into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Freeport McMoran Copper Gold and Lord Abbett Mid, you can compare the effects of market volatilities on Freeport McMoran 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 Freeport McMoran with a short position of Lord Abbett. Check out your portfolio center. Please also check ongoing floating volatility patterns of Freeport McMoran and Lord Abbett.
Diversification Opportunities for Freeport McMoran and Lord Abbett
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Freeport and Lord is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Freeport McMoran Copper Gold and Lord Abbett Mid in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lord Abbett Mid and Freeport McMoran 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 Freeport McMoran Copper Gold 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 Mid has no effect on the direction of Freeport McMoran i.e., Freeport McMoran and Lord Abbett go up and down completely randomly.
Pair Corralation between Freeport McMoran and Lord Abbett
If you would invest 4,460 in Freeport McMoran Copper Gold on January 26, 2024 and sell it today you would earn a total of 364.00 from holding Freeport McMoran Copper Gold or generate 8.16% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Flat |
Strength | Insignificant |
Accuracy | 0.0% |
Values | Daily Returns |
Freeport McMoran Copper Gold vs. Lord Abbett Mid
Performance |
Timeline |
Freeport McMoran Copper |
Lord Abbett Mid |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Freeport McMoran and Lord Abbett Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Freeport McMoran and Lord Abbett
The main advantage of trading using opposite Freeport McMoran and Lord Abbett positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Freeport McMoran 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.Freeport McMoran vs. Ero Copper Corp | Freeport McMoran vs. Taseko Mines | Freeport McMoran vs. Metals Acquisition Limited | Freeport McMoran vs. Hecla Mining |
Lord Abbett vs. Crafword Dividend Growth | Lord Abbett vs. Champlain Mid Cap | Lord Abbett vs. Needham Aggressive Growth | Lord Abbett vs. Qs Growth 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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