Correlation Between Investec Emerging and L Abbett
Can any of the company-specific risk be diversified away by investing in both Investec Emerging and L 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 Investec Emerging and L Abbett into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Investec Emerging Markets and L Abbett Growth, you can compare the effects of market volatilities on Investec Emerging and L 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 Investec Emerging with a short position of L Abbett. Check out your portfolio center. Please also check ongoing floating volatility patterns of Investec Emerging and L Abbett.
Diversification Opportunities for Investec Emerging and L Abbett
0.96 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Investec and LGLSX is 0.96. Overlapping area represents the amount of risk that can be diversified away by holding Investec Emerging Markets and L Abbett Growth in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on L Abbett Growth and Investec Emerging 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 Investec Emerging Markets are associated (or correlated) with L Abbett. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of L Abbett Growth has no effect on the direction of Investec Emerging i.e., Investec Emerging and L Abbett go up and down completely randomly.
Pair Corralation between Investec Emerging and L Abbett
Assuming the 90 days horizon Investec Emerging is expected to generate 1.56 times less return on investment than L Abbett. But when comparing it to its historical volatility, Investec Emerging Markets is 1.41 times less risky than L Abbett. It trades about 0.24 of its potential returns per unit of risk. L Abbett Growth is currently generating about 0.26 of returns per unit of risk over similar time horizon. If you would invest 4,806 in L Abbett Growth on June 13, 2025 and sell it today you would earn a total of 866.00 from holding L Abbett Growth or generate 18.02% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Investec Emerging Markets vs. L Abbett Growth
Performance |
| Timeline |
| Investec Emerging Markets |
| L Abbett Growth |
Investec Emerging and L Abbett Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Investec Emerging and L Abbett
The main advantage of trading using opposite Investec Emerging and L Abbett positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Investec Emerging position performs unexpectedly, L 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 L Abbett will offset losses from the drop in L Abbett's long position.| Investec Emerging vs. Investec Emerging Markets | Investec Emerging vs. Ninety One Global | Investec Emerging vs. Investec Global Franchise | Investec Emerging vs. Investec Global Franchise |
| L Abbett vs. Lord Abbett Small | L Abbett vs. Ultrasmall Cap Profund Ultrasmall Cap | L Abbett vs. Small Cap Value Fund | L Abbett vs. Fidelity Small Cap |
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 Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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