Correlation Between Lord Abbett and Active International

Can any of the company-specific risk be diversified away by investing in both Lord Abbett and Active International 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 Active International 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 Active International Allocation, you can compare the effects of market volatilities on Lord Abbett and Active International 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 Active International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lord Abbett and Active International.

Diversification Opportunities for Lord Abbett and Active International

0.94

Correlation Coefficient

Lord Abbett  Active International

Almost no diversification

The 3 months correlation between Lord and Active is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding Lord Abbett Short and Active International Allocatio in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Active International 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 Active International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Active International has no effect on the direction of Lord Abbett i.e., Lord Abbett and Active International go up and down completely randomly.

Pair Corralation between Lord Abbett and Active International

Assuming the 90 days horizon Lord Abbett is expected to generate 1.61 times less return on investment than Active International. But when comparing it to its historical volatility, Lord Abbett Short is 2.71 times less risky than Active International. It trades about 0.3 of its potential returns per unit of risk. Active International Allocation is currently generating about 0.18 of returns per unit of risk over similar time horizon. If you would invest  1,810  in Active International Allocation on May 2, 2025 and sell it today you would earn a total of  121.00  from holding Active International Allocation or generate 6.69% return on investment over 90 days.

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

Lord Abbett Short  vs.  Active International Allocatio

Lord Abbett Short

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Lord Abbett Short are ranked lower than 23 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong forward indicators, Lord Abbett is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Active International

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Active International Allocation are ranked lower than 13 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak basic indicators, Active International may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Pair Trading with Lord Abbett and Active International

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

The idea behind Lord Abbett Short and Active International Allocation 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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.