Correlation Between Transamerica Intermediate and Calamos Short-term
Can any of the company-specific risk be diversified away by investing in both Transamerica Intermediate and Calamos Short-term 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 Transamerica Intermediate and Calamos Short-term into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Transamerica Intermediate Muni and Calamos Short Term Bond, you can compare the effects of market volatilities on Transamerica Intermediate and Calamos Short-term 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 Transamerica Intermediate with a short position of Calamos Short-term. Check out your portfolio center. Please also check ongoing floating volatility patterns of Transamerica Intermediate and Calamos Short-term.
Diversification Opportunities for Transamerica Intermediate and Calamos Short-term
0.8 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Transamerica and Calamos is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding Transamerica Intermediate Muni and Calamos Short Term Bond in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Calamos Short Term and Transamerica Intermediate 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 Transamerica Intermediate Muni are associated (or correlated) with Calamos Short-term. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Calamos Short Term has no effect on the direction of Transamerica Intermediate i.e., Transamerica Intermediate and Calamos Short-term go up and down completely randomly.
Pair Corralation between Transamerica Intermediate and Calamos Short-term
Assuming the 90 days horizon Transamerica Intermediate is expected to generate 1.23 times less return on investment than Calamos Short-term. In addition to that, Transamerica Intermediate is 1.49 times more volatile than Calamos Short Term Bond. It trades about 0.07 of its total potential returns per unit of risk. Calamos Short Term Bond is currently generating about 0.14 per unit of volatility. If you would invest 856.00 in Calamos Short Term Bond on September 2, 2024 and sell it today you would earn a total of 98.00 from holding Calamos Short Term Bond or generate 11.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Transamerica Intermediate Muni vs. Calamos Short Term Bond
Performance |
| Timeline |
| Transamerica Intermediate |
| Calamos Short Term |
Transamerica Intermediate and Calamos Short-term Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Transamerica Intermediate and Calamos Short-term
The main advantage of trading using opposite Transamerica Intermediate and Calamos Short-term positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Transamerica Intermediate position performs unexpectedly, Calamos Short-term 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 Short-term will offset losses from the drop in Calamos Short-term's long position.The idea behind Transamerica Intermediate Muni and Calamos Short Term Bond pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
| Calamos Short-term vs. Lord Abbett Small | Calamos Short-term vs. Heartland Value Plus | Calamos Short-term vs. Mid Cap Value Profund | Calamos Short-term vs. Vanguard Small Cap Value |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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