Correlation Between IShares Trust and Calvert Short

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

By analyzing existing cross correlation between iShares Trust and Calvert Short Duration, you can compare the effects of market volatilities on IShares Trust and Calvert Short 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 IShares Trust with a short position of Calvert Short. Check out your portfolio center. Please also check ongoing floating volatility patterns of IShares Trust and Calvert Short.

Diversification Opportunities for IShares Trust and Calvert Short

0.77

Correlation Coefficient

IShares Trust  Calvert Short

Poor diversification

The 3 months correlation between IShares and Calvert is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding iShares Trust and Calvert Short Duration in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Calvert Short Duration and IShares Trust 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 iShares Trust are associated (or correlated) with Calvert Short. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Calvert Short Duration has no effect on the direction of IShares Trust i.e., IShares Trust and Calvert Short go up and down completely randomly.

Pair Corralation between IShares Trust and Calvert Short

Given the investment horizon of 90 days iShares Trust is expected to generate 1.16 times more return on investment than Calvert Short. However, IShares Trust is 1.16 times more volatile than Calvert Short Duration. It trades about 0.33 of its potential returns per unit of risk. Calvert Short Duration is currently generating about 0.22 per unit of risk. If you would invest  2,445  in iShares Trust on May 12, 2025 and sell it today you would earn a total of  78.00  from holding iShares Trust or generate 3.19% return on investment over 90 days.

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

iShares Trust   vs.  Calvert Short Duration

iShares Trust

Risk-Adjusted Performance

Strong

Compared to the overall equity markets, risk-adjusted returns on investments in iShares Trust are ranked lower than 26 (%) of all global equities and portfolios over the last 90 days. In spite of fairly stable fundamental indicators, IShares Trust is not utilizing all of its potentials. The current stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Calvert Short Duration

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Calvert Short Duration are ranked lower than 17 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, Calvert Short is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with IShares Trust and Calvert Short

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

The idea behind iShares Trust and Calvert Short Duration 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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.