Correlation Between Calvert International and Sterling Capital
Can any of the company-specific risk be diversified away by investing in both Calvert International and Sterling Capital 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 Sterling Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Calvert International Equity and Sterling Capital Special, you can compare the effects of market volatilities on Calvert International and Sterling Capital 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 Sterling Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Calvert International and Sterling Capital.
Diversification Opportunities for Calvert International and Sterling Capital
0.46 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Calvert and Sterling is 0.46. Overlapping area represents the amount of risk that can be diversified away by holding Calvert International Equity and Sterling Capital Special in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sterling Capital Special 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 Equity are associated (or correlated) with Sterling Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sterling Capital Special has no effect on the direction of Calvert International i.e., Calvert International and Sterling Capital go up and down completely randomly.
Pair Corralation between Calvert International and Sterling Capital
Assuming the 90 days horizon Calvert International Equity is expected to generate 0.33 times more return on investment than Sterling Capital. However, Calvert International Equity is 3.03 times less risky than Sterling Capital. It trades about 0.11 of its potential returns per unit of risk. Sterling Capital Special is currently generating about -0.1 per unit of risk. If you would invest 2,422 in Calvert International Equity on October 26, 2024 and sell it today you would earn a total of 83.00 from holding Calvert International Equity or generate 3.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Calvert International Equity vs. Sterling Capital Special
Performance |
| Timeline |
| Calvert International |
| Sterling Capital Special |
Calvert International and Sterling Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Calvert International and Sterling Capital
The main advantage of trading using opposite Calvert International and Sterling Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Calvert International position performs unexpectedly, Sterling Capital 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 Sterling Capital will offset losses from the drop in Sterling Capital's long position.| Calvert International vs. Goldman Sachs Smallmid | Calvert International vs. Hunter Small Cap | Calvert International vs. Astoncrosswind Small Cap | Calvert International vs. Df Dent Small |
| Sterling Capital vs. Enhanced Fixed Income | Sterling Capital vs. Dws Equity Sector | Sterling Capital vs. Calvert International Equity | Sterling Capital vs. Dreyfusstandish Global Fixed |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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