Correlation Between Cisco Systems and Eaton Vance

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

By analyzing existing cross correlation between Cisco Systems and Eaton Vance Worldwide, you can compare the effects of market volatilities on Cisco Systems and Eaton Vance 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 Cisco Systems with a short position of Eaton Vance. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cisco Systems and Eaton Vance.

Diversification Opportunities for Cisco Systems and Eaton Vance

0.85

Correlation Coefficient

Cisco Systems  Eaton Vance

Very poor diversification

The 3 months correlation between Cisco and Eaton is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Cisco Systems and Eaton Vance Worldwide in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eaton Vance Worldwide and Cisco Systems 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 Cisco Systems are associated (or correlated) with Eaton Vance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eaton Vance Worldwide has no effect on the direction of Cisco Systems i.e., Cisco Systems and Eaton Vance go up and down completely randomly.

Pair Corralation between Cisco Systems and Eaton Vance

Given the investment horizon of 90 days Cisco Systems is expected to generate 1.51 times more return on investment than Eaton Vance. However, Cisco Systems is 1.51 times more volatile than Eaton Vance Worldwide. It trades about 0.15 of its potential returns per unit of risk. Eaton Vance Worldwide is currently generating about 0.19 per unit of risk. If you would invest  6,739  in Cisco Systems on August 31, 2025 and sell it today you would earn a total of  868.00  from holding Cisco Systems or generate 12.88% return on investment over 90 days.

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

Cisco Systems  vs.  Eaton Vance Worldwide

Cisco Systems

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Cisco Systems are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating fundamental indicators, Cisco Systems displayed solid returns over the last few months and may actually be approaching a breakup point.

Eaton Vance Worldwide

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Eaton Vance Worldwide are ranked lower than 14 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak basic indicators, Eaton Vance may actually be approaching a critical reversion point that can send shares even higher in December 2025.

Pair Trading with Cisco Systems and Eaton Vance

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

The idea behind Cisco Systems and Eaton Vance Worldwide 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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.