Correlation Between NYSE Composite and Calvert Emerging
Can any of the company-specific risk be diversified away by investing in both NYSE Composite and Calvert Emerging 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 Emerging 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 Emerging Markets, you can compare the effects of market volatilities on NYSE Composite and Calvert Emerging 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 Emerging. Check out your portfolio center. Please also check ongoing floating volatility patterns of NYSE Composite and Calvert Emerging.
Diversification Opportunities for NYSE Composite and Calvert Emerging
0.52 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between NYSE and Calvert is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding NYSE Composite and Calvert Emerging Markets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Calvert Emerging Markets 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 Emerging. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Calvert Emerging Markets has no effect on the direction of NYSE Composite i.e., NYSE Composite and Calvert Emerging go up and down completely randomly.
Pair Corralation between NYSE Composite and Calvert Emerging
Assuming the 90 days trading horizon NYSE Composite is expected to generate 0.58 times more return on investment than Calvert Emerging. However, NYSE Composite is 1.74 times less risky than Calvert Emerging. It trades about 0.12 of its potential returns per unit of risk. Calvert Emerging Markets is currently generating about -0.08 per unit of risk. If you would invest 1,950,655 in NYSE Composite on August 25, 2024 and sell it today you would earn a total of 61,690 from holding NYSE Composite or generate 3.16% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
NYSE Composite vs. Calvert Emerging Markets
Performance |
Timeline |
NYSE Composite and Calvert Emerging Volatility Contrast
Predicted Return Density |
Returns |
NYSE Composite
Pair trading matchups for NYSE Composite
Calvert Emerging Markets
Pair trading matchups for Calvert Emerging
Pair Trading with NYSE Composite and Calvert Emerging
The main advantage of trading using opposite NYSE Composite and Calvert Emerging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NYSE Composite position performs unexpectedly, Calvert Emerging 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 Emerging will offset losses from the drop in Calvert Emerging's long position.NYSE Composite vs. Glacier Bancorp | NYSE Composite vs. LithiumBank Resources Corp | NYSE Composite vs. Stepstone Group | NYSE Composite vs. Pintec Technology Holdings |
Calvert Emerging vs. Calvert Developed Market | Calvert Emerging vs. Calvert Developed Market | Calvert Emerging vs. Calvert Short Duration | Calvert Emerging 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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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