Correlation Between Calamos Strategic and Vanguard Materials
Can any of the company-specific risk be diversified away by investing in both Calamos Strategic and Vanguard Materials 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 Calamos Strategic and Vanguard Materials into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Calamos Strategic Total and Vanguard Materials Index, you can compare the effects of market volatilities on Calamos Strategic and Vanguard Materials 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 Calamos Strategic with a short position of Vanguard Materials. Check out your portfolio center. Please also check ongoing floating volatility patterns of Calamos Strategic and Vanguard Materials.
Diversification Opportunities for Calamos Strategic and Vanguard Materials
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Calamos and Vanguard is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Calamos Strategic Total and Vanguard Materials Index in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vanguard Materials Index and Calamos Strategic 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 Calamos Strategic Total are associated (or correlated) with Vanguard Materials. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vanguard Materials Index has no effect on the direction of Calamos Strategic i.e., Calamos Strategic and Vanguard Materials go up and down completely randomly.
Pair Corralation between Calamos Strategic and Vanguard Materials
Considering the 90-day investment horizon Calamos Strategic Total is expected to generate 0.94 times more return on investment than Vanguard Materials. However, Calamos Strategic Total is 1.07 times less risky than Vanguard Materials. It trades about 0.15 of its potential returns per unit of risk. Vanguard Materials Index is currently generating about 0.08 per unit of risk. If you would invest 1,338 in Calamos Strategic Total on August 26, 2024 and sell it today you would earn a total of 463.00 from holding Calamos Strategic Total or generate 34.6% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Calamos Strategic Total vs. Vanguard Materials Index
Performance |
| Timeline |
| Calamos Strategic Total |
| Vanguard Materials Index |
Calamos Strategic and Vanguard Materials Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Calamos Strategic and Vanguard Materials
The main advantage of trading using opposite Calamos Strategic and Vanguard Materials positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Calamos Strategic position performs unexpectedly, Vanguard Materials 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 Vanguard Materials will offset losses from the drop in Vanguard Materials' long position.| Calamos Strategic vs. Allspring Income Opportunities | Calamos Strategic vs. Allspring Global Dividend | Calamos Strategic vs. Blackstone Gso Senior | Calamos Strategic vs. John Hancock Preferred |
| Vanguard Materials vs. Vanguard Emerging Markets | Vanguard Materials vs. Vanguard Total International | Vanguard Materials vs. Vanguard Reit Index | Vanguard Materials vs. Vanguard Industrials Index |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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