Correlation Between Lord Abbett and Intermediate-term
Can any of the company-specific risk be diversified away by investing in both Lord Abbett and Intermediate-term 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 Lord Abbett and Intermediate-term into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lord Abbett Short and Intermediate Term Tax Free Bond, you can compare the effects of market volatilities on Lord Abbett and Intermediate-term 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 Lord Abbett with a short position of Intermediate-term. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lord Abbett and Intermediate-term.
Diversification Opportunities for Lord Abbett and Intermediate-term
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Lord and Intermediate-term is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Lord Abbett Short and Intermediate Term Tax Free Bon in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Intermediate Term Tax and Lord Abbett 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 Lord Abbett Short are associated (or correlated) with Intermediate-term. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Intermediate Term Tax has no effect on the direction of Lord Abbett i.e., Lord Abbett and Intermediate-term go up and down completely randomly.
Pair Corralation between Lord Abbett and Intermediate-term
Assuming the 90 days horizon Lord Abbett Short is expected to generate 1.48 times more return on investment than Intermediate-term. However, Lord Abbett is 1.48 times more volatile than Intermediate Term Tax Free Bond. It trades about 0.35 of its potential returns per unit of risk. Intermediate Term Tax Free Bond is currently generating about 0.15 per unit of risk. If you would invest 947.00 in Lord Abbett Short on May 30, 2025 and sell it today you would earn a total of 39.00 from holding Lord Abbett Short or generate 4.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lord Abbett Short vs. Intermediate Term Tax Free Bon
Performance |
| Timeline |
| Lord Abbett Short |
| Intermediate Term Tax |
Lord Abbett and Intermediate-term Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lord Abbett and Intermediate-term
The main advantage of trading using opposite Lord Abbett and Intermediate-term positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lord Abbett position performs unexpectedly, Intermediate-term 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 Intermediate-term will offset losses from the drop in Intermediate-term's long position.| Lord Abbett vs. Health Care Ultrasector | Lord Abbett vs. Baron Health Care | Lord Abbett vs. Vanguard Health Care | Lord Abbett vs. The Hartford Healthcare |
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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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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