Correlation Between Calvert Income and Cullen Small

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

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

Diversification Opportunities for Calvert Income and Cullen Small

0.82

Correlation Coefficient

Calvert Income  Cullen Small

Very poor diversification

The 3 months correlation between Calvert and Cullen is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Calvert Income Fund and Cullen Small Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cullen Small Cap and Calvert Income 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 Income Fund are associated (or correlated) with Cullen Small. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cullen Small Cap has no effect on the direction of Calvert Income i.e., Calvert Income and Cullen Small go up and down completely randomly.

Pair Corralation between Calvert Income and Cullen Small

Assuming the 90 days horizon Calvert Income Fund is expected to generate 0.23 times more return on investment than Cullen Small. However, Calvert Income Fund is 4.43 times less risky than Cullen Small. It trades about 0.09 of its potential returns per unit of risk. Cullen Small Cap is currently generating about 0.02 per unit of risk. If you would invest  1,305  in Calvert Income Fund on May 2, 2025 and sell it today you would earn a total of  219.00  from holding Calvert Income Fund or generate 16.78% return on investment over 90 days.

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

Calvert Income Fund  vs.  Cullen Small Cap

Calvert Income

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Calvert Income Fund are ranked lower than 12 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong fundamental indicators, Calvert Income is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Cullen Small Cap

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Cullen Small Cap are ranked lower than 9 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak forward indicators, Cullen Small may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Pair Trading with Calvert Income and Cullen Small

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

The idea behind Calvert Income Fund and Cullen Small Cap 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.

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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..