Correlation Between Calvert Balanced and Global Strategist
Can any of the company-specific risk be diversified away by investing in both Calvert Balanced and Global Strategist 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 Balanced and Global Strategist into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Calvert Balanced Portfolio and Global Strategist Portfolio, you can compare the effects of market volatilities on Calvert Balanced and Global Strategist 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 Balanced with a short position of Global Strategist. Check out your portfolio center. Please also check ongoing floating volatility patterns of Calvert Balanced and Global Strategist.
Diversification Opportunities for Calvert Balanced and Global Strategist
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Calvert and Global is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Calvert Balanced Portfolio and Global Strategist Portfolio in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Global Strategist and Calvert Balanced 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 Balanced Portfolio are associated (or correlated) with Global Strategist. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Global Strategist has no effect on the direction of Calvert Balanced i.e., Calvert Balanced and Global Strategist go up and down completely randomly.
Pair Corralation between Calvert Balanced and Global Strategist
Assuming the 90 days horizon Calvert Balanced Portfolio is expected to under-perform the Global Strategist. In addition to that, Calvert Balanced is 1.37 times more volatile than Global Strategist Portfolio. It trades about -0.1 of its total potential returns per unit of risk. Global Strategist Portfolio is currently generating about -0.12 per unit of volatility. If you would invest 1,790 in Global Strategist Portfolio on January 14, 2025 and sell it today you would lose (57.00) from holding Global Strategist Portfolio or give up 3.18% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Calvert Balanced Portfolio vs. Global Strategist Portfolio
Performance |
| Timeline |
| Calvert Balanced Por |
| Global Strategist |
Calvert Balanced and Global Strategist Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Calvert Balanced and Global Strategist
The main advantage of trading using opposite Calvert Balanced and Global Strategist positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Calvert Balanced position performs unexpectedly, Global Strategist 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 Global Strategist will offset losses from the drop in Global Strategist's long position.| Calvert Balanced vs. Calvert Developed Market | Calvert Balanced vs. Calvert Developed Market | Calvert Balanced vs. Calvert Short Duration | Calvert Balanced vs. Calvert International Responsible |
| Global Strategist vs. Emerging Markets Equity | Global Strategist vs. Global Fixed Income | Global Strategist vs. Global Fixed Income | Global Strategist vs. Global Fixed Income |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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