Correlation Between Mastercard and Eaton Vance
Can any of the company-specific risk be diversified away by investing in both Mastercard 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 Mastercard and Eaton Vance into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mastercard and Eaton Vance Senior, you can compare the effects of market volatilities on Mastercard 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 Mastercard with a short position of Eaton Vance. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mastercard and Eaton Vance.
Diversification Opportunities for Mastercard and Eaton Vance
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Mastercard and Eaton is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Mastercard and Eaton Vance Senior in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eaton Vance Senior and Mastercard 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 Mastercard 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 Senior has no effect on the direction of Mastercard i.e., Mastercard and Eaton Vance go up and down completely randomly.
Pair Corralation between Mastercard and Eaton Vance
Allowing for the 90-day total investment horizon Mastercard is expected to generate 1.69 times more return on investment than Eaton Vance. However, Mastercard is 1.69 times more volatile than Eaton Vance Senior. It trades about 0.11 of its potential returns per unit of risk. Eaton Vance Senior is currently generating about 0.09 per unit of risk. If you would invest 41,077 in Mastercard on September 2, 2024 and sell it today you would earn a total of 12,217 from holding Mastercard or generate 29.74% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Mastercard vs. Eaton Vance Senior
Performance |
| Timeline |
| Mastercard |
| Eaton Vance Senior |
Mastercard and Eaton Vance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mastercard and Eaton Vance
The main advantage of trading using opposite Mastercard and Eaton Vance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mastercard 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.| Mastercard vs. American Express | Mastercard vs. PayPal Holdings | Mastercard vs. Upstart Holdings | Mastercard vs. Capital One Financial |
| Eaton Vance vs. Blackrock Floating Rate | Eaton Vance vs. Pioneer Floating Rate | Eaton Vance vs. Eaton Vance Senior | Eaton Vance vs. Blackrock Debt Strategies |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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