Correlation Between Calvert International and Calvert Emerging
Can any of the company-specific risk be diversified away by investing in both Calvert International and Calvert Emerging 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 Calvert International and Calvert Emerging into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Calvert International Responsible and Calvert Emerging Markets, you can compare the effects of market volatilities on Calvert International and Calvert Emerging 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 Calvert International with a short position of Calvert Emerging. Check out your portfolio center. Please also check ongoing floating volatility patterns of Calvert International and Calvert Emerging.
Diversification Opportunities for Calvert International and Calvert Emerging
0.42 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Calvert and Calvert is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding Calvert International Responsi and Calvert Emerging Markets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Calvert Emerging Markets and Calvert International 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 Calvert International Responsible are associated (or correlated) with Calvert Emerging. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Calvert Emerging Markets has no effect on the direction of Calvert International i.e., Calvert International and Calvert Emerging go up and down completely randomly.
Pair Corralation between Calvert International and Calvert Emerging
Assuming the 90 days horizon Calvert International Responsible is expected to generate 0.85 times more return on investment than Calvert Emerging. However, Calvert International Responsible is 1.17 times less risky than Calvert Emerging. It trades about 0.06 of its potential returns per unit of risk. Calvert Emerging Markets is currently generating about 0.02 per unit of risk. If you would invest 2,441 in Calvert International Responsible on August 25, 2024 and sell it today you would earn a total of 636.00 from holding Calvert International Responsible or generate 26.05% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Calvert International Responsi vs. Calvert Emerging Markets
Performance |
| Timeline |
| Calvert International |
| Calvert Emerging Markets |
Calvert International and Calvert Emerging Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Calvert International and Calvert Emerging
The main advantage of trading using opposite Calvert International and Calvert Emerging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Calvert International position performs unexpectedly, Calvert Emerging 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 Emerging will offset losses from the drop in Calvert Emerging's long position.| Calvert International vs. Calvert Large Cap E | Calvert International vs. Calvert Developed Market | Calvert International vs. Columbia Minnesota Tax Exempt |
| Calvert Emerging vs. Calvert Developed Market | Calvert Emerging vs. Calvert Developed Market | Calvert Emerging vs. Calvert Short Duration | Calvert Emerging vs. Calvert International Responsible |
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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
Other Complementary Tools
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets |