Correlation Between California Bond and Eaton Vance
Can any of the company-specific risk be diversified away by investing in both California Bond 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 California Bond and Eaton Vance into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between California Bond Fund and Eaton Vance Floating Rate, you can compare the effects of market volatilities on California Bond 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 California Bond with a short position of Eaton Vance. Check out your portfolio center. Please also check ongoing floating volatility patterns of California Bond and Eaton Vance.
Diversification Opportunities for California Bond and Eaton Vance
-0.17 | Correlation Coefficient |
Good diversification
The 3 months correlation between California and Eaton is -0.17. Overlapping area represents the amount of risk that can be diversified away by holding California Bond Fund and Eaton Vance Floating Rate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eaton Vance Floating and California Bond 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 California Bond 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 Floating has no effect on the direction of California Bond i.e., California Bond and Eaton Vance go up and down completely randomly.
Pair Corralation between California Bond and Eaton Vance
Assuming the 90 days horizon California Bond Fund is expected to generate 6.34 times more return on investment than Eaton Vance. However, California Bond is 6.34 times more volatile than Eaton Vance Floating Rate. It trades about 0.18 of its potential returns per unit of risk. Eaton Vance Floating Rate is currently generating about 0.18 per unit of risk. If you would invest 1,038 in California Bond Fund on September 3, 2024 and sell it today you would earn a total of 13.00 from holding California Bond Fund or generate 1.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
California Bond Fund vs. Eaton Vance Floating Rate
Performance |
| Timeline |
| California Bond |
| Eaton Vance Floating |
California Bond and Eaton Vance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with California Bond and Eaton Vance
The main advantage of trading using opposite California Bond and Eaton Vance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if California Bond 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.| California Bond vs. Franklin California Tax Free | California Bond vs. Franklin California Tax Free | California Bond vs. Franklin California Tax Free | California Bond vs. Franklin California Tax Free |
| Eaton Vance vs. T Rowe Price | Eaton Vance vs. Touchstone Premium Yield | Eaton Vance vs. California Bond Fund | Eaton Vance vs. Maryland Tax Free Bond |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
Other Complementary Tools
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format |