Correlation Between Dow Jones and Calamos Dynamic
Can any of the company-specific risk be diversified away by investing in both Dow Jones and Calamos Dynamic 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 Dow Jones and Calamos Dynamic into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dow Jones Industrial and Calamos Dynamic Convertible, you can compare the effects of market volatilities on Dow Jones and Calamos Dynamic 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 Dow Jones with a short position of Calamos Dynamic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dow Jones and Calamos Dynamic.
Diversification Opportunities for Dow Jones and Calamos Dynamic
0.6 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Dow and Calamos is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding Dow Jones Industrial and Calamos Dynamic Convertible in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Calamos Dynamic Conv and Dow Jones 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 Dow Jones Industrial are associated (or correlated) with Calamos Dynamic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Calamos Dynamic Conv has no effect on the direction of Dow Jones i.e., Dow Jones and Calamos Dynamic go up and down completely randomly.
Pair Corralation between Dow Jones and Calamos Dynamic
Assuming the 90 days trading horizon Dow Jones Industrial is expected to generate 0.88 times more return on investment than Calamos Dynamic. However, Dow Jones Industrial is 1.14 times less risky than Calamos Dynamic. It trades about 0.26 of its potential returns per unit of risk. Calamos Dynamic Convertible is currently generating about -0.08 per unit of risk. If you would invest 4,238,757 in Dow Jones Industrial on August 28, 2024 and sell it today you would earn a total of 234,900 from holding Dow Jones Industrial or generate 5.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dow Jones Industrial vs. Calamos Dynamic Convertible
Performance |
| Timeline |
Dow Jones and Calamos Dynamic Volatility Contrast
Predicted Return Density |
| Returns |
Dow Jones Industrial
Pair trading matchups for Dow Jones
Calamos Dynamic Convertible
Pair trading matchups for Calamos Dynamic
Pair Trading with Dow Jones and Calamos Dynamic
The main advantage of trading using opposite Dow Jones and Calamos Dynamic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dow Jones position performs unexpectedly, Calamos Dynamic 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 Calamos Dynamic will offset losses from the drop in Calamos Dynamic's long position.| Dow Jones vs. Meiwu Technology Co | Dow Jones vs. 17 Education Technology | Dow Jones vs. 51Talk Online Education | Dow Jones vs. Afya |
| Calamos Dynamic vs. Calamos Convertible Opportunities | Calamos Dynamic vs. Calamos Global Dynamic | Calamos Dynamic vs. Calamos Strategic Total | Calamos Dynamic vs. Calamos LongShort 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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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