Correlation Between Federated Hermes and Eaton Vance
Can any of the company-specific risk be diversified away by investing in both Federated Hermes 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 Federated Hermes and Eaton Vance into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Federated Hermes Inflation and Eaton Vance Short, you can compare the effects of market volatilities on Federated Hermes 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 Federated Hermes with a short position of Eaton Vance. Check out your portfolio center. Please also check ongoing floating volatility patterns of Federated Hermes and Eaton Vance.
Diversification Opportunities for Federated Hermes and Eaton Vance
0.94 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Federated and Eaton is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding Federated Hermes Inflation and Eaton Vance Short in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eaton Vance Short and Federated Hermes 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 Federated Hermes Inflation 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 Short has no effect on the direction of Federated Hermes i.e., Federated Hermes and Eaton Vance go up and down completely randomly.
Pair Corralation between Federated Hermes and Eaton Vance
Assuming the 90 days horizon Federated Hermes is expected to generate 1.6 times less return on investment than Eaton Vance. In addition to that, Federated Hermes is 1.17 times more volatile than Eaton Vance Short. It trades about 0.04 of its total potential returns per unit of risk. Eaton Vance Short is currently generating about 0.08 per unit of volatility. If you would invest 689.00 in Eaton Vance Short on September 14, 2024 and sell it today you would earn a total of 33.00 from holding Eaton Vance Short or generate 4.79% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Federated Hermes Inflation vs. Eaton Vance Short
Performance |
| Timeline |
| Federated Hermes Inf |
| Eaton Vance Short |
Federated Hermes and Eaton Vance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Federated Hermes and Eaton Vance
The main advantage of trading using opposite Federated Hermes and Eaton Vance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Federated Hermes 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.| Federated Hermes vs. Commodities Strategy Fund | Federated Hermes vs. Eic Value Fund | Federated Hermes vs. T Rowe Price | Federated Hermes vs. Rbb Fund |
| Eaton Vance vs. Eaton Vance Msschsts | Eaton Vance vs. Eaton Vance Municipal | Eaton Vance vs. Eaton Vance Municipal | Eaton Vance vs. Eaton Vance Municipal |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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