Correlation Between Nasdaq 100 and Eaton Vance
Can any of the company-specific risk be diversified away by investing in both Nasdaq 100 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 Nasdaq 100 and Eaton Vance into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nasdaq 100 Fund Class and Eaton Vance Short, you can compare the effects of market volatilities on Nasdaq 100 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 Nasdaq 100 with a short position of Eaton Vance. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nasdaq 100 and Eaton Vance.
Diversification Opportunities for Nasdaq 100 and Eaton Vance
-0.18 | Correlation Coefficient |
Good diversification
The 3 months correlation between Nasdaq and Eaton is -0.18. Overlapping area represents the amount of risk that can be diversified away by holding Nasdaq 100 Fund Class and Eaton Vance Short in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eaton Vance Short and Nasdaq 100 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 Nasdaq 100 Fund Class 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 Short has no effect on the direction of Nasdaq 100 i.e., Nasdaq 100 and Eaton Vance go up and down completely randomly.
Pair Corralation between Nasdaq 100 and Eaton Vance
Assuming the 90 days horizon Nasdaq 100 Fund Class is expected to generate 9.67 times more return on investment than Eaton Vance. However, Nasdaq 100 is 9.67 times more volatile than Eaton Vance Short. It trades about 0.09 of its potential returns per unit of risk. Eaton Vance Short is currently generating about 0.15 per unit of risk. If you would invest 6,076 in Nasdaq 100 Fund Class on September 4, 2024 and sell it today you would earn a total of 1,647 from holding Nasdaq 100 Fund Class or generate 27.11% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nasdaq 100 Fund Class vs. Eaton Vance Short
Performance |
| Timeline |
| Nasdaq 100 Fund |
| Eaton Vance Short |
Nasdaq 100 and Eaton Vance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nasdaq 100 and Eaton Vance
The main advantage of trading using opposite Nasdaq 100 and Eaton Vance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nasdaq 100 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.| Nasdaq 100 vs. Nasdaq 100 Fund Class | Nasdaq 100 vs. Nasdaq 100 Fund Class | Nasdaq 100 vs. Nasdaq 100 2x Strategy | Nasdaq 100 vs. Dow 2x Strategy |
| Eaton Vance vs. Auer Growth Fund | Eaton Vance vs. Volumetric Fund Volumetric | Eaton Vance vs. Growth Strategy Fund | Eaton Vance vs. Nasdaq 100 Fund Class |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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