Correlation Between Calvert Us and Capital Management
Can any of the company-specific risk be diversified away by investing in both Calvert Us and Capital Management 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 Calvert Us and Capital Management into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Calvert Large Cap and Capital Management Mid Cap, you can compare the effects of market volatilities on Calvert Us and Capital Management 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 Calvert Us with a short position of Capital Management. Check out your portfolio center. Please also check ongoing floating volatility patterns of Calvert Us and Capital Management.
Diversification Opportunities for Calvert Us and Capital Management
0.78 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Calvert and Capital is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding Calvert Large Cap and Capital Management Mid Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Capital Management Mid and Calvert Us 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 Calvert Large Cap are associated (or correlated) with Capital Management. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Capital Management Mid has no effect on the direction of Calvert Us i.e., Calvert Us and Capital Management go up and down completely randomly.
Pair Corralation between Calvert Us and Capital Management
Assuming the 90 days horizon Calvert Large Cap is expected to generate 1.15 times more return on investment than Capital Management. However, Calvert Us is 1.15 times more volatile than Capital Management Mid Cap. It trades about 0.29 of its potential returns per unit of risk. Capital Management Mid Cap is currently generating about 0.11 per unit of risk. If you would invest 6,123 in Calvert Large Cap on April 25, 2025 and sell it today you would earn a total of 979.00 from holding Calvert Large Cap or generate 15.99% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
Calvert Large Cap vs. Capital Management Mid Cap
Performance |
Timeline |
Calvert Large Cap |
Capital Management Mid |
Calvert Us and Capital Management Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Calvert Us and Capital Management
The main advantage of trading using opposite Calvert Us and Capital Management positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Calvert Us position performs unexpectedly, Capital Management 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 Capital Management will offset losses from the drop in Capital Management's long position.Calvert Us vs. Calvert Large Cap | Calvert Us vs. Calvert Large Cap | Calvert Us vs. Calvert Large Cap | Calvert Us vs. Calvert Mid Cap |
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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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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