Correlation Between Clearbridge Small and Qs Small

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

By analyzing existing cross correlation between Clearbridge Small Cap and Qs Small Capitalization, you can compare the effects of market volatilities on Clearbridge Small and Qs Small 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 Clearbridge Small with a short position of Qs Small. Check out your portfolio center. Please also check ongoing floating volatility patterns of Clearbridge Small and Qs Small.

Diversification Opportunities for Clearbridge Small and Qs Small

0.9

Correlation Coefficient

Clearbridge Small  Qs Small

Almost no diversification

The 3 months correlation between Clearbridge and LGSCX is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding Clearbridge Small Cap and Qs Small Capitalization in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Qs Small Capitalization and Clearbridge Small 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 Clearbridge Small Cap are associated (or correlated) with Qs Small. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Qs Small Capitalization has no effect on the direction of Clearbridge Small i.e., Clearbridge Small and Qs Small go up and down completely randomly.

Pair Corralation between Clearbridge Small and Qs Small

Assuming the 90 days horizon Clearbridge Small is expected to generate 1.98 times less return on investment than Qs Small. In addition to that, Clearbridge Small is 1.09 times more volatile than Qs Small Capitalization. It trades about 0.09 of its total potential returns per unit of risk. Qs Small Capitalization is currently generating about 0.19 per unit of volatility. If you would invest  1,139  in Qs Small Capitalization on May 5, 2025 and sell it today you would earn a total of  148.00  from holding Qs Small Capitalization or generate 12.99% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Strong
Accuracy	100.0%
Values	Daily Returns

Clearbridge Small Cap  vs.  Qs Small Capitalization

Clearbridge Small Cap

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Clearbridge Small Cap are ranked lower than 6 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak basic indicators, Clearbridge Small may actually be approaching a critical reversion point that can send shares even higher in September 2025.

Qs Small Capitalization

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Qs Small Capitalization are ranked lower than 15 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak fundamental indicators, Qs Small may actually be approaching a critical reversion point that can send shares even higher in September 2025.

Pair Trading with Clearbridge Small and Qs Small

The main advantage of trading using opposite Clearbridge Small and Qs Small positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Clearbridge Small position performs unexpectedly, Qs Small 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 Qs Small will offset losses from the drop in Qs Small's long position.

The idea behind Clearbridge Small Cap and Qs Small Capitalization 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.

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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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.