Correlation Between Hotchkis Wiley and Lord Abbett
Can any of the company-specific risk be diversified away by investing in both Hotchkis Wiley 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 Hotchkis Wiley and Lord Abbett into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hotchkis Wiley Diversified and Lord Abbett Bond, you can compare the effects of market volatilities on Hotchkis Wiley 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 Hotchkis Wiley with a short position of Lord Abbett. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hotchkis Wiley and Lord Abbett.
Diversification Opportunities for Hotchkis Wiley and Lord Abbett
0.55 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Hotchkis and Lord is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding Hotchkis Wiley Diversified and Lord Abbett Bond in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lord Abbett Bond and Hotchkis Wiley 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 Hotchkis Wiley Diversified 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 Bond has no effect on the direction of Hotchkis Wiley i.e., Hotchkis Wiley and Lord Abbett go up and down completely randomly.
Pair Corralation between Hotchkis Wiley and Lord Abbett
Assuming the 90 days horizon Hotchkis Wiley Diversified is expected to generate 4.02 times more return on investment than Lord Abbett. However, Hotchkis Wiley is 4.02 times more volatile than Lord Abbett Bond. It trades about 0.04 of its potential returns per unit of risk. Lord Abbett Bond is currently generating about 0.09 per unit of risk. If you would invest 3,157 in Hotchkis Wiley Diversified on September 4, 2025 and sell it today you would earn a total of 59.00 from holding Hotchkis Wiley Diversified or generate 1.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hotchkis Wiley Diversified vs. Lord Abbett Bond
Performance |
| Timeline |
| Hotchkis Wiley Diver |
| Lord Abbett Bond |
Hotchkis Wiley and Lord Abbett Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hotchkis Wiley and Lord Abbett
The main advantage of trading using opposite Hotchkis Wiley and Lord Abbett positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hotchkis Wiley 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.| Hotchkis Wiley vs. The Hartford Healthcare | Hotchkis Wiley vs. Baron Health Care | Hotchkis Wiley vs. Hartford Healthcare Hls | Hotchkis Wiley vs. Alger Health Sciences |
| Lord Abbett vs. Vanguard Energy Index | Lord Abbett vs. Invesco Energy Fund | Lord Abbett vs. Blackrock Resources Commodities | Lord Abbett vs. Franklin Natural Resources |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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