Correlation Between California High and Eaton Vance
Can any of the company-specific risk be diversified away by investing in both California High 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 California High and Eaton Vance into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between California High Yield Municipal and Eaton Vance Global, you can compare the effects of market volatilities on California High 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 California High with a short position of Eaton Vance. Check out your portfolio center. Please also check ongoing floating volatility patterns of California High and Eaton Vance.
Diversification Opportunities for California High and Eaton Vance
0.2 | Correlation Coefficient |
Modest diversification
The 3 months correlation between California and Eaton is 0.2. Overlapping area represents the amount of risk that can be diversified away by holding California High Yield Municipa and Eaton Vance Global in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eaton Vance Global and California 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 California High Yield Municipal 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 Global has no effect on the direction of California High i.e., California High and Eaton Vance go up and down completely randomly.
Pair Corralation between California High and Eaton Vance
Assuming the 90 days horizon California High Yield Municipal is expected to generate 1.23 times more return on investment than Eaton Vance. However, California High is 1.23 times more volatile than Eaton Vance Global. It trades about 0.46 of its potential returns per unit of risk. Eaton Vance Global is currently generating about 0.1 per unit of risk. If you would invest 983.00 in California High Yield Municipal on September 12, 2024 and sell it today you would earn a total of 13.00 from holding California High Yield Municipal or generate 1.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
California High Yield Municipa vs. Eaton Vance Global
Performance |
| Timeline |
| California High Yield |
| Eaton Vance Global |
California High and Eaton Vance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with California High and Eaton Vance
The main advantage of trading using opposite California High and Eaton Vance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if California High 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.| California High vs. T Rowe Price | California High vs. Bbh Intermediate Municipal | California High vs. Ab Bond Inflation | California High vs. Blrc Sgy Mnp |
| Eaton Vance vs. T Rowe Price | Eaton Vance vs. California High Yield Municipal | Eaton Vance vs. Baird Strategic Municipal | Eaton Vance vs. Nuveen Minnesota Municipal |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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