Correlation Between MicroSectors FANG and Calamos ETF
Can any of the company-specific risk be diversified away by investing in both MicroSectors FANG and Calamos ETF 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 MicroSectors FANG and Calamos ETF into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MicroSectors FANG Index and Calamos ETF Trust, you can compare the effects of market volatilities on MicroSectors FANG and Calamos ETF 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 MicroSectors FANG with a short position of Calamos ETF. Check out your portfolio center. Please also check ongoing floating volatility patterns of MicroSectors FANG and Calamos ETF.
Diversification Opportunities for MicroSectors FANG and Calamos ETF
0.19 | Correlation Coefficient |
Average diversification
The 3 months correlation between MicroSectors and Calamos is 0.19. Overlapping area represents the amount of risk that can be diversified away by holding MicroSectors FANG Index and Calamos ETF Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Calamos ETF Trust and MicroSectors FANG 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 MicroSectors FANG Index are associated (or correlated) with Calamos ETF. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Calamos ETF Trust has no effect on the direction of MicroSectors FANG i.e., MicroSectors FANG and Calamos ETF go up and down completely randomly.
Pair Corralation between MicroSectors FANG and Calamos ETF
Given the investment horizon of 90 days MicroSectors FANG Index is expected to generate 26.69 times more return on investment than Calamos ETF. However, MicroSectors FANG is 26.69 times more volatile than Calamos ETF Trust. It trades about 0.05 of its potential returns per unit of risk. Calamos ETF Trust is currently generating about -0.02 per unit of risk. If you would invest 59,809 in MicroSectors FANG Index on October 7, 2024 and sell it today you would earn a total of 1,655 from holding MicroSectors FANG Index or generate 2.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
MicroSectors FANG Index vs. Calamos ETF Trust
Performance |
| Timeline |
| MicroSectors FANG Index |
| Calamos ETF Trust |
MicroSectors FANG and Calamos ETF Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MicroSectors FANG and Calamos ETF
The main advantage of trading using opposite MicroSectors FANG and Calamos ETF positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MicroSectors FANG position performs unexpectedly, Calamos ETF 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 ETF will offset losses from the drop in Calamos ETF's long position.| MicroSectors FANG vs. Direxion Daily Semiconductor | MicroSectors FANG vs. MicroSectors Solactive FANG | MicroSectors FANG vs. MicroSectors FANG Index | MicroSectors FANG vs. Direxion Daily Technology |
| Calamos ETF vs. FT Vest Equity | Calamos ETF vs. Northern Lights | Calamos ETF vs. Dimensional International High | Calamos ETF vs. First Trust Exchange Traded |
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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