Correlation Between Home Depot and Calamos Global
Can any of the company-specific risk be diversified away by investing in both Home Depot and Calamos Global 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 Home Depot and Calamos Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Home Depot and Calamos Global Dynamic, you can compare the effects of market volatilities on Home Depot and Calamos Global 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 Home Depot with a short position of Calamos Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Home Depot and Calamos Global.
Diversification Opportunities for Home Depot and Calamos Global
0.81 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Home and Calamos is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding Home Depot and Calamos Global Dynamic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Calamos Global Dynamic and Home Depot 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 Home Depot are associated (or correlated) with Calamos Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Calamos Global Dynamic has no effect on the direction of Home Depot i.e., Home Depot and Calamos Global go up and down completely randomly.
Pair Corralation between Home Depot and Calamos Global
Allowing for the 90-day total investment horizon Home Depot is expected to generate 1.77 times more return on investment than Calamos Global. However, Home Depot is 1.77 times more volatile than Calamos Global Dynamic. It trades about 0.19 of its potential returns per unit of risk. Calamos Global Dynamic is currently generating about -0.05 per unit of risk. If you would invest 40,289 in Home Depot on August 28, 2024 and sell it today you would earn a total of 2,578 from holding Home Depot or generate 6.4% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 95.45% |
| Values | Daily Returns |
Home Depot vs. Calamos Global Dynamic
Performance |
| Timeline |
| Home Depot |
| Calamos Global Dynamic |
Home Depot and Calamos Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Home Depot and Calamos Global
The main advantage of trading using opposite Home Depot and Calamos Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Home Depot position performs unexpectedly, Calamos Global 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 Global will offset losses from the drop in Calamos Global's long position.| Home Depot vs. Arhaus Inc | Home Depot vs. Haverty Furniture Companies | Home Depot vs. Kirklands | Home Depot vs. Haverty Furniture Companies |
| Calamos Global vs. Calamos Convertible And | Calamos Global vs. Calamos Strategic Total | Calamos Global vs. Calamos Dynamic Convertible | Calamos Global 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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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