Correlation Between NYSE Composite and Calvert Bond
Can any of the company-specific risk be diversified away by investing in both NYSE Composite and Calvert Bond 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 NYSE Composite and Calvert Bond into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NYSE Composite and Calvert Bond Portfolio, you can compare the effects of market volatilities on NYSE Composite and Calvert Bond 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 NYSE Composite with a short position of Calvert Bond. Check out your portfolio center. Please also check ongoing floating volatility patterns of NYSE Composite and Calvert Bond.
Diversification Opportunities for NYSE Composite and Calvert Bond
-0.54 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between NYSE and Calvert is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding NYSE Composite and Calvert Bond Portfolio in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Calvert Bond Portfolio and NYSE Composite 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 NYSE Composite are associated (or correlated) with Calvert Bond. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Calvert Bond Portfolio has no effect on the direction of NYSE Composite i.e., NYSE Composite and Calvert Bond go up and down completely randomly.
Pair Corralation between NYSE Composite and Calvert Bond
Assuming the 90 days trading horizon NYSE Composite is expected to generate 2.02 times more return on investment than Calvert Bond. However, NYSE Composite is 2.02 times more volatile than Calvert Bond Portfolio. It trades about 0.24 of its potential returns per unit of risk. Calvert Bond Portfolio is currently generating about 0.08 per unit of risk. If you would invest 1,954,967 in NYSE Composite on August 29, 2024 and sell it today you would earn a total of 66,978 from holding NYSE Composite or generate 3.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
NYSE Composite vs. Calvert Bond Portfolio
Performance |
| Timeline |
NYSE Composite and Calvert Bond Volatility Contrast
Predicted Return Density |
| Returns |
NYSE Composite
Pair trading matchups for NYSE Composite
Calvert Bond Portfolio
Pair trading matchups for Calvert Bond
Pair Trading with NYSE Composite and Calvert Bond
The main advantage of trading using opposite NYSE Composite and Calvert Bond positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NYSE Composite position performs unexpectedly, Calvert Bond 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 Calvert Bond will offset losses from the drop in Calvert Bond's long position.| NYSE Composite vs. Vita Coco | NYSE Composite vs. Franklin Wireless Corp | NYSE Composite vs. Ambev SA ADR | NYSE Composite vs. Toro Co |
| Calvert Bond vs. Calvert Developed Market | Calvert Bond vs. Calvert Developed Market | Calvert Bond vs. Calvert Short Duration | Calvert Bond vs. Calvert International Responsible |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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