Correlation Between Growth Strategy and Eaton Vance
Can any of the company-specific risk be diversified away by investing in both Growth Strategy 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 Growth Strategy and Eaton Vance into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Growth Strategy Fund and Eaton Vance Tax Managed, you can compare the effects of market volatilities on Growth Strategy 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 Growth Strategy with a short position of Eaton Vance. Check out your portfolio center. Please also check ongoing floating volatility patterns of Growth Strategy and Eaton Vance.
Diversification Opportunities for Growth Strategy and Eaton Vance
0.89 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Growth and Eaton is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding Growth Strategy Fund and Eaton Vance Tax Managed in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eaton Vance Tax and Growth Strategy 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 Growth Strategy Fund 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 Tax has no effect on the direction of Growth Strategy i.e., Growth Strategy and Eaton Vance go up and down completely randomly.
Pair Corralation between Growth Strategy and Eaton Vance
Assuming the 90 days horizon Growth Strategy is expected to generate 1.51 times less return on investment than Eaton Vance. But when comparing it to its historical volatility, Growth Strategy Fund is 1.04 times less risky than Eaton Vance. It trades about 0.07 of its potential returns per unit of risk. Eaton Vance Tax Managed is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 1,682 in Eaton Vance Tax Managed on October 22, 2024 and sell it today you would earn a total of 20.00 from holding Eaton Vance Tax Managed or generate 1.19% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Growth Strategy Fund vs. Eaton Vance Tax Managed
Performance |
| Timeline |
| Growth Strategy |
| Eaton Vance Tax |
Growth Strategy and Eaton Vance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Growth Strategy and Eaton Vance
The main advantage of trading using opposite Growth Strategy and Eaton Vance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Growth Strategy 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.| Growth Strategy vs. Oppenheimer Gold Special | Growth Strategy vs. Vy Goldman Sachs | Growth Strategy vs. Gamco Global Gold | Growth Strategy vs. International Investors Gold |
| Eaton Vance vs. Qs Large Cap | Eaton Vance vs. T Rowe Price | Eaton Vance vs. T Rowe Price | Eaton Vance vs. The Texas Fund |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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