Correlation Between Visa and Calvert Long-term

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

By analyzing existing cross correlation between Visa Class A and Calvert Long Term Income, you can compare the effects of market volatilities on Visa and Calvert Long-term 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 Visa with a short position of Calvert Long-term. Check out your portfolio center. Please also check ongoing floating volatility patterns of Visa and Calvert Long-term.

Diversification Opportunities for Visa and Calvert Long-term

-0.25

Correlation Coefficient

Visa  Calvert Long-term

Very good diversification

The 3 months correlation between Visa and Calvert is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding Visa Class A and Calvert Long Term Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Calvert Long Term and Visa 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 Visa Class A are associated (or correlated) with Calvert Long-term. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Calvert Long Term has no effect on the direction of Visa i.e., Visa and Calvert Long-term go up and down completely randomly.

Pair Corralation between Visa and Calvert Long-term

Taking into account the 90-day investment horizon Visa Class A is expected to under-perform the Calvert Long-term. In addition to that, Visa is 5.15 times more volatile than Calvert Long Term Income. It trades about -0.04 of its total potential returns per unit of risk. Calvert Long Term Income is currently generating about 0.22 per unit of volatility. If you would invest  1,559  in Calvert Long Term Income on July 23, 2025 and sell it today you would earn a total of  48.00  from holding Calvert Long Term Income or generate 3.08% return on investment over 90 days.

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

Visa Class A  vs.  Calvert Long Term Income

Visa Class A

Risk-Adjusted Performance

Weakest

Over the last 90 days Visa Class A has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable basic indicators, Visa is not utilizing all of its potentials. The current stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Calvert Long Term

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Calvert Long Term Income 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 Long-term is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Visa and Calvert Long-term

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

The idea behind Visa Class A and Calvert Long Term Income 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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.