Correlation Between Janus Triton and Lord Abbett

Can any of the company-specific risk be diversified away by investing in both Janus Triton 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 Janus Triton and Lord Abbett into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Janus Triton Fund and Lord Abbett Alpha, you can compare the effects of market volatilities on Janus Triton 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 Janus Triton with a short position of Lord Abbett. Check out your portfolio center. Please also check ongoing floating volatility patterns of Janus Triton and Lord Abbett.

Diversification Opportunities for Janus Triton and Lord Abbett

0.92

Correlation Coefficient

Janus Triton  Lord Abbett

Almost no diversification

The 3 months correlation between Janus and Lord is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding Janus Triton Fund and Lord Abbett Alpha in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lord Abbett Alpha and Janus Triton 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 Janus Triton Fund 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 Alpha has no effect on the direction of Janus Triton i.e., Janus Triton and Lord Abbett go up and down completely randomly.

Pair Corralation between Janus Triton and Lord Abbett

Assuming the 90 days horizon Janus Triton is expected to generate 1.49 times less return on investment than Lord Abbett. But when comparing it to its historical volatility, Janus Triton Fund is 1.03 times less risky than Lord Abbett. It trades about 0.06 of its potential returns per unit of risk. Lord Abbett Alpha is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest  2,322  in Lord Abbett Alpha on January 17, 2024 and sell it today you would earn a total of  118.00  from holding Lord Abbett Alpha or generate 5.08% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Strong
Accuracy	98.41%
Values	Daily Returns

Janus Triton Fund  vs.  Lord Abbett Alpha

Janus Triton

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Janus Triton Fund are ranked lower than 4 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, Janus Triton is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Lord Abbett Alpha

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Lord Abbett Alpha are ranked lower than 6 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, Lord Abbett is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Janus Triton and Lord Abbett

The main advantage of trading using opposite Janus Triton and Lord Abbett positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Janus Triton 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.

The idea behind Janus Triton Fund and Lord Abbett Alpha pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..