Correlation Between Msift High and Calvert Us

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

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

Diversification Opportunities for Msift High and Calvert Us

0.99

Correlation Coefficient

Msift High  Calvert Us

No risk reduction

The 3 months correlation between Msift and Calvert is 0.99. Overlapping area represents the amount of risk that can be diversified away by holding Msift High Yield 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 Msift High 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 Msift High Yield are associated (or correlated) with Calvert Us. 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 Msift High i.e., Msift High and Calvert Us go up and down completely randomly.

Pair Corralation between Msift High and Calvert Us

Assuming the 90 days horizon Msift High is expected to generate 3.59 times less return on investment than Calvert Us. But when comparing it to its historical volatility, Msift High Yield is 4.55 times less risky than Calvert Us. It trades about 0.38 of its potential returns per unit of risk. Calvert Large Cap E is currently generating about 0.3 of returns per unit of risk over similar time horizon. If you would invest  4,722  in Calvert Large Cap E on April 25, 2025 and sell it today you would earn a total of  705.00  from holding Calvert Large Cap E or generate 14.93% return on investment over 90 days.

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

Msift High Yield  vs.  Calvert Large Cap E

Msift High Yield

Risk-Adjusted Performance

Strong

Compared to the overall equity markets, risk-adjusted returns on investments in Msift High Yield are ranked lower than 29 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, Msift High is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

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 23 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak basic indicators, Calvert Us showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Msift High and Calvert Us

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

The idea behind Msift High Yield 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 Global Correlations module to find global opportunities by holding instruments from different markets.