Correlation Between Calvert Moderate and Multimanager Lifestyle
Can any of the company-specific risk be diversified away by investing in both Calvert Moderate and Multimanager Lifestyle 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 Moderate and Multimanager Lifestyle into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Calvert Moderate Allocation and Multimanager Lifestyle Moderate, you can compare the effects of market volatilities on Calvert Moderate and Multimanager Lifestyle 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 Moderate with a short position of Multimanager Lifestyle. Check out your portfolio center. Please also check ongoing floating volatility patterns of Calvert Moderate and Multimanager Lifestyle.
Diversification Opportunities for Calvert Moderate and Multimanager Lifestyle
0.96 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Calvert and MULTIMANAGER is 0.96. Overlapping area represents the amount of risk that can be diversified away by holding Calvert Moderate Allocation and Multimanager Lifestyle Moderat in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Multimanager Lifestyle and Calvert Moderate 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 Moderate Allocation are associated (or correlated) with Multimanager Lifestyle. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Multimanager Lifestyle has no effect on the direction of Calvert Moderate i.e., Calvert Moderate and Multimanager Lifestyle go up and down completely randomly.
Pair Corralation between Calvert Moderate and Multimanager Lifestyle
Assuming the 90 days horizon Calvert Moderate Allocation is expected to generate 1.44 times more return on investment than Multimanager Lifestyle. However, Calvert Moderate is 1.44 times more volatile than Multimanager Lifestyle Moderate. It trades about 0.19 of its potential returns per unit of risk. Multimanager Lifestyle Moderate is currently generating about 0.19 per unit of risk. If you would invest 2,083 in Calvert Moderate Allocation on August 31, 2024 and sell it today you would earn a total of 40.00 from holding Calvert Moderate Allocation or generate 1.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Calvert Moderate Allocation vs. Multimanager Lifestyle Moderat
Performance |
| Timeline |
| Calvert Moderate All |
| Multimanager Lifestyle |
Calvert Moderate and Multimanager Lifestyle Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Calvert Moderate and Multimanager Lifestyle
The main advantage of trading using opposite Calvert Moderate and Multimanager Lifestyle positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Calvert Moderate position performs unexpectedly, Multimanager Lifestyle 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 Multimanager Lifestyle will offset losses from the drop in Multimanager Lifestyle's long position.| Calvert Moderate vs. American Funds American | Calvert Moderate vs. American Funds American | Calvert Moderate vs. American Balanced | Calvert Moderate vs. American Balanced Fund |
| Multimanager Lifestyle vs. Westwood Income Opportunity | Multimanager Lifestyle vs. First Eagle Global | Multimanager Lifestyle vs. Berwyn Income Fund | Multimanager Lifestyle vs. Fpa Crescent Fund |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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