Correlation Between Guidemark(r) Small/mid and Lord Abbett
Can any of the company-specific risk be diversified away by investing in both Guidemark(r) Small/mid 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 Guidemark(r) Small/mid and Lord Abbett into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Guidemark Smallmid Cap and Lord Abbett Inv, you can compare the effects of market volatilities on Guidemark(r) Small/mid 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 Guidemark(r) Small/mid with a short position of Lord Abbett. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guidemark(r) Small/mid and Lord Abbett.
Diversification Opportunities for Guidemark(r) Small/mid and Lord Abbett
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Guidemark(r) and Lord is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Guidemark Smallmid Cap and Lord Abbett Inv in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lord Abbett Inv and Guidemark(r) Small/mid 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 Guidemark Smallmid Cap 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 Inv has no effect on the direction of Guidemark(r) Small/mid i.e., Guidemark(r) Small/mid and Lord Abbett go up and down completely randomly.
Pair Corralation between Guidemark(r) Small/mid and Lord Abbett
Assuming the 90 days horizon Guidemark Smallmid Cap is expected to generate 9.11 times more return on investment than Lord Abbett. However, Guidemark(r) Small/mid is 9.11 times more volatile than Lord Abbett Inv. It trades about 0.07 of its potential returns per unit of risk. Lord Abbett Inv is currently generating about 0.1 per unit of risk. If you would invest 1,838 in Guidemark Smallmid Cap on June 4, 2025 and sell it today you would earn a total of 254.00 from holding Guidemark Smallmid Cap or generate 13.82% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Guidemark Smallmid Cap vs. Lord Abbett Inv
Performance |
| Timeline |
| Guidemark Smallmid Cap |
| Lord Abbett Inv |
Guidemark(r) Small/mid and Lord Abbett Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guidemark(r) Small/mid and Lord Abbett
The main advantage of trading using opposite Guidemark(r) Small/mid and Lord Abbett positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guidemark(r) Small/mid 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.| Guidemark(r) Small/mid vs. Aew Real Estate | Guidemark(r) Small/mid vs. Redwood Real Estate | Guidemark(r) Small/mid vs. Baron Real Estate | Guidemark(r) Small/mid vs. Prudential Real Estate |
| Lord Abbett vs. Lord Abbett Trust | Lord Abbett vs. Lord Abbett Trust | Lord Abbett vs. Lord Abbett Focused | Lord Abbett vs. Lord Abbett Growth |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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