Correlation Between Arrowmark Financial and Eaton Vance
Can any of the company-specific risk be diversified away by investing in both Arrowmark Financial 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 Arrowmark Financial and Eaton Vance into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Arrowmark Financial Corp and Eaton Vance National, you can compare the effects of market volatilities on Arrowmark Financial 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 Arrowmark Financial with a short position of Eaton Vance. Check out your portfolio center. Please also check ongoing floating volatility patterns of Arrowmark Financial and Eaton Vance.
Diversification Opportunities for Arrowmark Financial and Eaton Vance
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Arrowmark and Eaton is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding Arrowmark Financial Corp and Eaton Vance National in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eaton Vance National and Arrowmark Financial 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 Arrowmark Financial Corp 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 National has no effect on the direction of Arrowmark Financial i.e., Arrowmark Financial and Eaton Vance go up and down completely randomly.
Pair Corralation between Arrowmark Financial and Eaton Vance
Given the investment horizon of 90 days Arrowmark Financial Corp is expected to under-perform the Eaton Vance. But the stock apears to be less risky and, when comparing its historical volatility, Arrowmark Financial Corp is 1.08 times less risky than Eaton Vance. The stock trades about -0.16 of its potential returns per unit of risk. The Eaton Vance National is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest 1,675 in Eaton Vance National on November 28, 2024 and sell it today you would earn a total of 30.00 from holding Eaton Vance National or generate 1.79% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Arrowmark Financial Corp vs. Eaton Vance National
Performance |
| Timeline |
| Arrowmark Financial Corp |
| Eaton Vance National |
Arrowmark Financial and Eaton Vance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Arrowmark Financial and Eaton Vance
The main advantage of trading using opposite Arrowmark Financial and Eaton Vance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Arrowmark Financial 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.| Arrowmark Financial vs. Brookfield Business Corp | Arrowmark Financial vs. Elysee Development Corp | Arrowmark Financial vs. DWS Municipal Income | Arrowmark Financial vs. Blackrock Munivest |
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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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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