Correlation Between Highland Global and Calvert Large

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

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

Diversification Opportunities for Highland Global and Calvert Large

0.66

Correlation Coefficient

Highland Global  Calvert Large

Poor diversification

The 3 months correlation between Highland and Calvert is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Highland Global Allocation and Calvert Large Cap E in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Calvert Large Cap and Highland Global 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 Highland Global Allocation are associated (or correlated) with Calvert Large. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Calvert Large Cap has no effect on the direction of Highland Global i.e., Highland Global and Calvert Large go up and down completely randomly.

Pair Corralation between Highland Global and Calvert Large

Given the investment horizon of 90 days Highland Global is expected to generate 2.23 times less return on investment than Calvert Large. In addition to that, Highland Global is 1.47 times more volatile than Calvert Large Cap E. It trades about 0.09 of its total potential returns per unit of risk. Calvert Large Cap E is currently generating about 0.31 per unit of volatility. If you would invest  4,754  in Calvert Large Cap E on April 29, 2025 and sell it today you would earn a total of  743.00  from holding Calvert Large Cap E or generate 15.63% return on investment over 90 days.

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

Highland Global Allocation  vs.  Calvert Large Cap E

Highland Global Allo

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Highland Global Allocation are ranked lower than 7 (%) of all funds and portfolios of funds over the last 90 days. Despite somewhat unfluctuating essential indicators, Highland Global may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Calvert Large Cap

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Calvert Large Cap E are ranked lower than 24 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak basic indicators, Calvert Large showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Highland Global and Calvert Large

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

The idea behind Highland Global Allocation and Calvert Large Cap E 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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.