Correlation Between Stone Harbor and Eaton Vance
Can any of the company-specific risk be diversified away by investing in both Stone Harbor and Eaton Vance 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 Stone Harbor and Eaton Vance into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Stone Harbor Emerging and Eaton Vance Limited, you can compare the effects of market volatilities on Stone Harbor and Eaton Vance 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 Stone Harbor with a short position of Eaton Vance. Check out your portfolio center. Please also check ongoing floating volatility patterns of Stone Harbor and Eaton Vance.
Diversification Opportunities for Stone Harbor and Eaton Vance
0.41 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Stone and Eaton is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding Stone Harbor Emerging and Eaton Vance Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eaton Vance Limited and Stone Harbor 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 Stone Harbor Emerging are associated (or correlated) with Eaton Vance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eaton Vance Limited has no effect on the direction of Stone Harbor i.e., Stone Harbor and Eaton Vance go up and down completely randomly.
Pair Corralation between Stone Harbor and Eaton Vance
Considering the 90-day investment horizon Stone Harbor Emerging is expected to generate 2.3 times more return on investment than Eaton Vance. However, Stone Harbor is 2.3 times more volatile than Eaton Vance Limited. It trades about 0.07 of its potential returns per unit of risk. Eaton Vance Limited is currently generating about 0.11 per unit of risk. If you would invest 373.00 in Stone Harbor Emerging on September 12, 2024 and sell it today you would earn a total of 134.00 from holding Stone Harbor Emerging or generate 35.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Stone Harbor Emerging vs. Eaton Vance Limited
Performance |
| Timeline |
| Stone Harbor Emerging |
| Eaton Vance Limited |
Stone Harbor and Eaton Vance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Stone Harbor and Eaton Vance
The main advantage of trading using opposite Stone Harbor and Eaton Vance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Stone Harbor position performs unexpectedly, Eaton Vance 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 Eaton Vance will offset losses from the drop in Eaton Vance's long position.| Stone Harbor vs. Oxford Lane Capital | Stone Harbor vs. Orchid Island Capital | Stone Harbor vs. Guggenheim Strategic Opportunities |
| Eaton Vance vs. Oxford Lane Capital | Eaton Vance vs. Orchid Island Capital | Eaton Vance vs. Guggenheim Strategic Opportunities | Eaton Vance vs. Stone Harbor Emerging |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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