Correlation Between Multimedia Portfolio and Calamos High
Can any of the company-specific risk be diversified away by investing in both Multimedia Portfolio and Calamos High 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 Multimedia Portfolio and Calamos High into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Multimedia Portfolio Multimedia and Calamos High Income, you can compare the effects of market volatilities on Multimedia Portfolio and Calamos High 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 Multimedia Portfolio with a short position of Calamos High. Check out your portfolio center. Please also check ongoing floating volatility patterns of Multimedia Portfolio and Calamos High.
Diversification Opportunities for Multimedia Portfolio and Calamos High
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Multimedia and Calamos is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Multimedia Portfolio Multimedi and Calamos High Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Calamos High Income and Multimedia Portfolio 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 Multimedia Portfolio Multimedia are associated (or correlated) with Calamos High. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Calamos High Income has no effect on the direction of Multimedia Portfolio i.e., Multimedia Portfolio and Calamos High go up and down completely randomly.
Pair Corralation between Multimedia Portfolio and Calamos High
Assuming the 90 days horizon Multimedia Portfolio Multimedia is expected to generate 6.98 times more return on investment than Calamos High. However, Multimedia Portfolio is 6.98 times more volatile than Calamos High Income. It trades about 0.12 of its potential returns per unit of risk. Calamos High Income is currently generating about 0.22 per unit of risk. If you would invest 8,709 in Multimedia Portfolio Multimedia on September 14, 2024 and sell it today you would earn a total of 3,294 from holding Multimedia Portfolio Multimedia or generate 37.82% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 99.6% |
| Values | Daily Returns |
Multimedia Portfolio Multimedi vs. Calamos High Income
Performance |
| Timeline |
| Multimedia Portfolio |
| Calamos High Income |
Multimedia Portfolio and Calamos High Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Multimedia Portfolio and Calamos High
The main advantage of trading using opposite Multimedia Portfolio and Calamos High positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Multimedia Portfolio position performs unexpectedly, Calamos High 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 High will offset losses from the drop in Calamos High's long position.The idea behind Multimedia Portfolio Multimedia and Calamos High Income pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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