Correlation Between Lord Abbett and Catalyst/princeton

Can any of the company-specific risk be diversified away by investing in both Lord Abbett and Catalyst/princeton 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 Catalyst/princeton into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Lord Abbett Mid and Catalystprinceton Floating Rate, you can compare the effects of market volatilities on Lord Abbett and Catalyst/princeton 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 Catalyst/princeton. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lord Abbett and Catalyst/princeton.

Diversification Opportunities for Lord Abbett and Catalyst/princeton

0.88

Correlation Coefficient

Lord Abbett  Catalyst/princeton

Very poor diversification

The 3 months correlation between Lord and Catalyst/princeton is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Lord Abbett Mid and Catalystprinceton Floating Rat in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Catalyst/princeton 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 Mid are associated (or correlated) with Catalyst/princeton. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Catalyst/princeton has no effect on the direction of Lord Abbett i.e., Lord Abbett and Catalyst/princeton go up and down completely randomly.

Pair Corralation between Lord Abbett and Catalyst/princeton

Assuming the 90 days horizon Lord Abbett Mid is expected to generate 7.94 times more return on investment than Catalyst/princeton. However, Lord Abbett is 7.94 times more volatile than Catalystprinceton Floating Rate. It trades about 0.05 of its potential returns per unit of risk. Catalystprinceton Floating Rate is currently generating about 0.29 per unit of risk. If you would invest  3,151  in Lord Abbett Mid on May 3, 2025 and sell it today you would earn a total of  80.00  from holding Lord Abbett Mid or generate 2.54% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Strong
Accuracy	98.39%
Values	Daily Returns

Lord Abbett Mid  vs.  Catalystprinceton Floating Rat

Lord Abbett Mid

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Lord Abbett Mid are ranked lower than 3 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, Lord Abbett is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Catalyst/princeton

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Catalystprinceton Floating Rate are ranked lower than 22 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong fundamental indicators, Catalyst/princeton is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Lord Abbett and Catalyst/princeton

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

The idea behind Lord Abbett Mid and Catalystprinceton Floating Rate 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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.