Correlation Between Calvert Short and Old Westbury
Can any of the company-specific risk be diversified away by investing in both Calvert Short and Old Westbury 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 Short and Old Westbury into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Calvert Short Duration and Old Westbury Short Term, you can compare the effects of market volatilities on Calvert Short and Old Westbury 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 Short with a short position of Old Westbury. Check out your portfolio center. Please also check ongoing floating volatility patterns of Calvert Short and Old Westbury.
Diversification Opportunities for Calvert Short and Old Westbury
0.94 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Calvert and Old is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding Calvert Short Duration and Old Westbury Short Term in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Old Westbury Short and Calvert Short 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 Short Duration are associated (or correlated) with Old Westbury. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Old Westbury Short has no effect on the direction of Calvert Short i.e., Calvert Short and Old Westbury go up and down completely randomly.
Pair Corralation between Calvert Short and Old Westbury
Assuming the 90 days horizon Calvert Short Duration is expected to generate 1.26 times more return on investment than Old Westbury. However, Calvert Short is 1.26 times more volatile than Old Westbury Short Term. It trades about 0.2 of its potential returns per unit of risk. Old Westbury Short Term is currently generating about 0.11 per unit of risk. If you would invest 1,550 in Calvert Short Duration on October 29, 2024 and sell it today you would earn a total of 7.00 from holding Calvert Short Duration or generate 0.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Calvert Short Duration vs. Old Westbury Short Term
Performance |
| Timeline |
| Calvert Short Duration |
| Old Westbury Short |
Calvert Short and Old Westbury Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Calvert Short and Old Westbury
The main advantage of trading using opposite Calvert Short and Old Westbury positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Calvert Short position performs unexpectedly, Old Westbury 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 Old Westbury will offset losses from the drop in Old Westbury's long position.| Calvert Short vs. Calvert Short Duration | Calvert Short vs. Calvert Short Duration | Calvert Short vs. Calvert Income Fund | Calvert Short vs. Calvert Long Term Income |
| Old Westbury vs. Transamerica Large Cap | Old Westbury vs. Guidemark Large Cap | Old Westbury vs. Fisher Large Cap | Old Westbury vs. Ab Large Cap |
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 Anywhere module to track or share privately all of your investments from the convenience of any device.
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