Correlation Between Merck and Calamos Growth
Can any of the company-specific risk be diversified away by investing in both Merck and Calamos Growth 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 Merck and Calamos Growth into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Merck Company and Calamos Growth And, you can compare the effects of market volatilities on Merck and Calamos Growth 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 Merck with a short position of Calamos Growth. Check out your portfolio center. Please also check ongoing floating volatility patterns of Merck and Calamos Growth.
Diversification Opportunities for Merck and Calamos Growth
-0.83 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Merck and Calamos is -0.83. Overlapping area represents the amount of risk that can be diversified away by holding Merck Company and Calamos Growth And in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Calamos Growth And and Merck 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 Merck Company are associated (or correlated) with Calamos Growth. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Calamos Growth And has no effect on the direction of Merck i.e., Merck and Calamos Growth go up and down completely randomly.
Pair Corralation between Merck and Calamos Growth
Considering the 90-day investment horizon Merck is expected to generate 12.73 times less return on investment than Calamos Growth. In addition to that, Merck is 1.94 times more volatile than Calamos Growth And. It trades about 0.01 of its total potential returns per unit of risk. Calamos Growth And is currently generating about 0.16 per unit of volatility. If you would invest 3,699 in Calamos Growth And on September 1, 2024 and sell it today you would earn a total of 1,208 from holding Calamos Growth And or generate 32.66% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 99.63% |
| Values | Daily Returns |
Merck Company vs. Calamos Growth And
Performance |
| Timeline |
| Merck Company |
| Calamos Growth And |
Merck and Calamos Growth Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Merck and Calamos Growth
The main advantage of trading using opposite Merck and Calamos Growth positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Merck position performs unexpectedly, Calamos Growth 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 Growth will offset losses from the drop in Calamos Growth's long position.The idea behind Merck Company and Calamos Growth And 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.| Calamos Growth vs. Barings Active Short | Calamos Growth vs. Aqr Sustainable Long Short | Calamos Growth vs. Ab Select Longshort | Calamos Growth vs. Goldman Sachs Short Term |
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 File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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