Correlation Between Calvert International and Templeton Emerging
Can any of the company-specific risk be diversified away by investing in both Calvert International 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 International 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 International Opportunities and Templeton Emerging Markets, you can compare the effects of market volatilities on Calvert International 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 International with a short position of Templeton Emerging. Check out your portfolio center. Please also check ongoing floating volatility patterns of Calvert International and Templeton Emerging.
Diversification Opportunities for Calvert International and Templeton Emerging
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Calvert and Templeton is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Calvert International Opportun 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 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 Opportunities 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 International i.e., Calvert International and Templeton Emerging go up and down completely randomly.
Pair Corralation between Calvert International and Templeton Emerging
Assuming the 90 days horizon Calvert International is expected to generate 2.03 times less return on investment than Templeton Emerging. In addition to that, Calvert International is 1.47 times more volatile than Templeton Emerging Markets. It trades about 0.03 of its total potential returns per unit of risk. Templeton Emerging Markets is currently generating about 0.08 per unit of volatility. If you would invest 1,382 in Templeton Emerging Markets on September 12, 2024 and sell it today you would earn a total of 11.00 from holding Templeton Emerging Markets or generate 0.8% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 95.45% |
| Values | Daily Returns |
Calvert International Opportun vs. Templeton Emerging Markets
Performance |
| Timeline |
| Calvert International |
| Templeton Emerging |
Calvert International and Templeton Emerging Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Calvert International and Templeton Emerging
The main advantage of trading using opposite Calvert International and Templeton Emerging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Calvert International 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 International vs. Dodge Cox Stock | Calvert International vs. Guidemark Large Cap | Calvert International vs. Rational Strategic Allocation | Calvert International vs. T Rowe Price |
| Templeton Emerging vs. Guidemark Smallmid Cap | Templeton Emerging vs. Siit Small Mid | Templeton Emerging vs. Mutual Of America | Templeton Emerging vs. Aqr Small 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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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