Correlation Between Calamos Market and Otter Creek
Can any of the company-specific risk be diversified away by investing in both Calamos Market and Otter Creek 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 Otter Creek 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 Otter Creek Longshort, you can compare the effects of market volatilities on Calamos Market and Otter Creek 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 Otter Creek. Check out your portfolio center. Please also check ongoing floating volatility patterns of Calamos Market and Otter Creek.
Diversification Opportunities for Calamos Market and Otter Creek
0.84 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Calamos and Otter is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding Calamos Market Neutral and Otter Creek Longshort in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Otter Creek Longshort 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 Otter Creek. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Otter Creek Longshort has no effect on the direction of Calamos Market i.e., Calamos Market and Otter Creek go up and down completely randomly.
Pair Corralation between Calamos Market and Otter Creek
Assuming the 90 days horizon Calamos Market is expected to generate 1.14 times less return on investment than Otter Creek. But when comparing it to its historical volatility, Calamos Market Neutral is 7.62 times less risky than Otter Creek. It trades about 0.35 of its potential returns per unit of risk. Otter Creek Longshort is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 1,488 in Otter Creek Longshort on September 1, 2024 and sell it today you would earn a total of 12.00 from holding Otter Creek Longshort or generate 0.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 95.45% |
| Values | Daily Returns |
Calamos Market Neutral vs. Otter Creek Longshort
Performance |
| Timeline |
| Calamos Market Neutral |
| Otter Creek Longshort |
Calamos Market and Otter Creek Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Calamos Market and Otter Creek
The main advantage of trading using opposite Calamos Market and Otter Creek positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Calamos Market position performs unexpectedly, Otter Creek 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 Otter Creek will offset losses from the drop in Otter Creek'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 |
| Otter Creek vs. Boston Partners Global | Otter Creek vs. Asg Managed Futures | Otter Creek vs. Pimco Trends Managed | Otter Creek vs. Aqr Long Short Equity |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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