Correlation Between Adams Natural and Calvert Global
Can any of the company-specific risk be diversified away by investing in both Adams Natural and Calvert 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 Adams Natural and Calvert Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Adams Natural Resources and Calvert Global Energy, you can compare the effects of market volatilities on Adams Natural and Calvert 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 Adams Natural with a short position of Calvert Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Adams Natural and Calvert Global.
Diversification Opportunities for Adams Natural and Calvert Global
-0.07 | Correlation Coefficient |
Good diversification
The 3 months correlation between Adams and Calvert is -0.07. Overlapping area represents the amount of risk that can be diversified away by holding Adams Natural Resources and Calvert Global Energy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Calvert Global Energy and Adams Natural 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 Adams Natural Resources are associated (or correlated) with Calvert Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Calvert Global Energy has no effect on the direction of Adams Natural i.e., Adams Natural and Calvert Global go up and down completely randomly.
Pair Corralation between Adams Natural and Calvert Global
Considering the 90-day investment horizon Adams Natural Resources is expected to generate 1.08 times more return on investment than Calvert Global. However, Adams Natural is 1.08 times more volatile than Calvert Global Energy. It trades about 0.04 of its potential returns per unit of risk. Calvert Global Energy is currently generating about 0.0 per unit of risk. If you would invest 1,878 in Adams Natural Resources on September 4, 2024 and sell it today you would earn a total of 464.00 from holding Adams Natural Resources or generate 24.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Adams Natural Resources vs. Calvert Global Energy
Performance |
| Timeline |
| Adams Natural Resources |
| Calvert Global Energy |
Adams Natural and Calvert Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Adams Natural and Calvert Global
The main advantage of trading using opposite Adams Natural and Calvert Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Adams Natural position performs unexpectedly, Calvert 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 Calvert Global will offset losses from the drop in Calvert Global's long position.| Adams Natural vs. Liberty All Star | Adams Natural vs. Tri Continental Closed | Adams Natural vs. Royce Value Closed | Adams Natural vs. Central Securities |
| Calvert Global vs. Ashmore Emerging Markets | Calvert Global vs. Wells Fargo Funds | Calvert Global vs. Lord Abbett Emerging | Calvert Global vs. Elfun Government Money |
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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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