Correlation Between Calamos Market and Diamond Hill
Can any of the company-specific risk be diversified away by investing in both Calamos Market and Diamond Hill 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 Market and Diamond Hill into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Calamos Market Neutral and Diamond Hill Long Short, you can compare the effects of market volatilities on Calamos Market and Diamond Hill 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 Market with a short position of Diamond Hill. Check out your portfolio center. Please also check ongoing floating volatility patterns of Calamos Market and Diamond Hill.
Diversification Opportunities for Calamos Market and Diamond Hill
-0.04 | Correlation Coefficient |
Good diversification
The 3 months correlation between Calamos and Diamond is -0.04. Overlapping area represents the amount of risk that can be diversified away by holding Calamos Market Neutral and Diamond Hill Long Short in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Diamond Hill Long and Calamos Market 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 Market Neutral are associated (or correlated) with Diamond Hill. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Diamond Hill Long has no effect on the direction of Calamos Market i.e., Calamos Market and Diamond Hill go up and down completely randomly.
Pair Corralation between Calamos Market and Diamond Hill
Assuming the 90 days horizon Calamos Market is expected to generate 1.23 times less return on investment than Diamond Hill. But when comparing it to its historical volatility, Calamos Market Neutral is 2.73 times less risky than Diamond Hill. It trades about 0.11 of its potential returns per unit of risk. Diamond Hill Long Short is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 2,479 in Diamond Hill Long Short on August 25, 2024 and sell it today you would earn a total of 349.00 from holding Diamond Hill Long Short or generate 14.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Calamos Market Neutral vs. Diamond Hill Long Short
Performance |
| Timeline |
| Calamos Market Neutral |
| Diamond Hill Long |
Calamos Market and Diamond Hill Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Calamos Market and Diamond Hill
The main advantage of trading using opposite Calamos Market and Diamond Hill positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Calamos Market position performs unexpectedly, Diamond Hill 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 Diamond Hill will offset losses from the drop in Diamond Hill's long position.| Calamos Market vs. The Arbitrage Fund | Calamos Market vs. The Merger Fund | Calamos Market vs. Gateway Fund Class | Calamos Market vs. Diamond Hill Long Short |
| Diamond Hill vs. Diamond Hill Large | Diamond Hill vs. Diamond Hill International | Diamond Hill vs. Diamond Hill International | Diamond Hill vs. Diamond Hill Small Mid |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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