Correlation Between Calvert Income and Templeton Emerging
Can any of the company-specific risk be diversified away by investing in both Calvert Income and Templeton 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 Income and Templeton Emerging into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Calvert Income Fund and Templeton Emerging Markets, you can compare the effects of market volatilities on Calvert Income and Templeton 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 Income with a short position of Templeton Emerging. Check out your portfolio center. Please also check ongoing floating volatility patterns of Calvert Income and Templeton Emerging.
Diversification Opportunities for Calvert Income and Templeton Emerging
0.67 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Calvert and Templeton is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding Calvert Income Fund and Templeton Emerging Markets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Templeton Emerging and Calvert Income 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 Income Fund are associated (or correlated) with Templeton Emerging. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Templeton Emerging has no effect on the direction of Calvert Income i.e., Calvert Income and Templeton Emerging go up and down completely randomly.
Pair Corralation between Calvert Income and Templeton Emerging
Assuming the 90 days horizon Calvert Income Fund is expected to generate 0.46 times more return on investment than Templeton Emerging. However, Calvert Income Fund is 2.19 times less risky than Templeton Emerging. It trades about 0.13 of its potential returns per unit of risk. Templeton Emerging Markets is currently generating about 0.03 per unit of risk. If you would invest 1,447 in Calvert Income Fund on September 5, 2024 and sell it today you would earn a total of 69.00 from holding Calvert Income Fund or generate 4.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Calvert Income Fund vs. Templeton Emerging Markets
Performance |
| Timeline |
| Calvert Income |
| Templeton Emerging |
Calvert Income and Templeton Emerging Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Calvert Income and Templeton Emerging
The main advantage of trading using opposite Calvert Income and Templeton Emerging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Calvert Income position performs unexpectedly, Templeton 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 Templeton Emerging will offset losses from the drop in Templeton Emerging's long position.| Calvert Income vs. Templeton Emerging Markets | Calvert Income vs. T Rowe Price | Calvert Income vs. Commodities Strategy Fund | Calvert Income vs. Growth Strategy Fund |
| Templeton Emerging vs. T Rowe Price | Templeton Emerging vs. T Rowe Price | Templeton Emerging vs. Legg Mason Partners | Templeton Emerging vs. Hood River New |
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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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