Correlation Between Calvert Short and Westcore Municipal
Can any of the company-specific risk be diversified away by investing in both Calvert Short and Westcore Municipal 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 Westcore Municipal 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 Westcore Municipal Opportunities, you can compare the effects of market volatilities on Calvert Short and Westcore Municipal 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 Westcore Municipal. Check out your portfolio center. Please also check ongoing floating volatility patterns of Calvert Short and Westcore Municipal.
Diversification Opportunities for Calvert Short and Westcore Municipal
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Calvert and Westcore is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Calvert Short Duration and Westcore Municipal Opportuniti in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Westcore Municipal 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 Westcore Municipal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Westcore Municipal has no effect on the direction of Calvert Short i.e., Calvert Short and Westcore Municipal go up and down completely randomly.
Pair Corralation between Calvert Short and Westcore Municipal
Assuming the 90 days horizon Calvert Short Duration is expected to generate 0.94 times more return on investment than Westcore Municipal. However, Calvert Short Duration is 1.06 times less risky than Westcore Municipal. It trades about 0.13 of its potential returns per unit of risk. Westcore Municipal Opportunities is currently generating about 0.1 per unit of risk. If you would invest 1,401 in Calvert Short Duration on August 30, 2024 and sell it today you would earn a total of 156.00 from holding Calvert Short Duration or generate 11.13% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Calvert Short Duration vs. Westcore Municipal Opportuniti
Performance |
| Timeline |
| Calvert Short Duration |
| Westcore Municipal |
Calvert Short and Westcore Municipal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Calvert Short and Westcore Municipal
The main advantage of trading using opposite Calvert Short and Westcore Municipal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Calvert Short position performs unexpectedly, Westcore Municipal 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 Westcore Municipal will offset losses from the drop in Westcore Municipal's long position.| Calvert Short vs. Permanent Portfolio Class | Calvert Short vs. HUMANA INC | Calvert Short vs. Aquagold International | Calvert Short vs. Barloworld Ltd ADR |
| Westcore Municipal vs. Artisan High Income | Westcore Municipal vs. Versatile Bond Portfolio | Westcore Municipal vs. T Rowe Price | Westcore Municipal vs. Maryland Tax Free Bond |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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