Correlation Between Sentinel Small and Calamos Market
Can any of the company-specific risk be diversified away by investing in both Sentinel Small and Calamos Market 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 Sentinel Small and Calamos Market into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sentinel Small Pany and Calamos Market Neutral, you can compare the effects of market volatilities on Sentinel Small and Calamos Market 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 Sentinel Small with a short position of Calamos Market. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sentinel Small and Calamos Market.
Diversification Opportunities for Sentinel Small and Calamos Market
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Sentinel and Calamos is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Sentinel Small Pany and Calamos Market Neutral in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Calamos Market Neutral and Sentinel Small 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 Sentinel Small Pany are associated (or correlated) with Calamos Market. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Calamos Market Neutral has no effect on the direction of Sentinel Small i.e., Sentinel Small and Calamos Market go up and down completely randomly.
Pair Corralation between Sentinel Small and Calamos Market
Assuming the 90 days horizon Sentinel Small Pany is expected to under-perform the Calamos Market. In addition to that, Sentinel Small is 10.4 times more volatile than Calamos Market Neutral. It trades about -0.07 of its total potential returns per unit of risk. Calamos Market Neutral is currently generating about 0.22 per unit of volatility. If you would invest 1,502 in Calamos Market Neutral on September 12, 2024 and sell it today you would earn a total of 6.00 from holding Calamos Market Neutral or generate 0.4% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sentinel Small Pany vs. Calamos Market Neutral
Performance |
| Timeline |
| Sentinel Small Pany |
| Calamos Market Neutral |
Sentinel Small and Calamos Market Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sentinel Small and Calamos Market
The main advantage of trading using opposite Sentinel Small and Calamos Market positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sentinel Small position performs unexpectedly, Calamos Market 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 Calamos Market will offset losses from the drop in Calamos Market's long position.| Sentinel Small vs. Dana Large Cap | Sentinel Small vs. Transamerica Large Cap | Sentinel Small vs. Avantis Large Cap | Sentinel Small vs. Qs Large Cap |
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 Stocks Directory module to find actively traded stocks across global markets.
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