Correlation Between Invesco California and Eaton Vance
Can any of the company-specific risk be diversified away by investing in both Invesco California 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 Invesco California and Eaton Vance into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Invesco California Value and Eaton Vance Senior, you can compare the effects of market volatilities on Invesco California 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 Invesco California with a short position of Eaton Vance. Check out your portfolio center. Please also check ongoing floating volatility patterns of Invesco California and Eaton Vance.
Diversification Opportunities for Invesco California and Eaton Vance
-0.69 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Invesco and Eaton is -0.69. Overlapping area represents the amount of risk that can be diversified away by holding Invesco California Value and Eaton Vance Senior in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eaton Vance Senior and Invesco California 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 Invesco California Value 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 Senior has no effect on the direction of Invesco California i.e., Invesco California and Eaton Vance go up and down completely randomly.
Pair Corralation between Invesco California and Eaton Vance
Considering the 90-day investment horizon Invesco California Value is expected to generate 1.87 times more return on investment than Eaton Vance. However, Invesco California is 1.87 times more volatile than Eaton Vance Senior. It trades about 0.17 of its potential returns per unit of risk. Eaton Vance Senior is currently generating about 0.2 per unit of risk. If you would invest 1,024 in Invesco California Value on September 1, 2024 and sell it today you would earn a total of 32.00 from holding Invesco California Value or generate 3.13% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Invesco California Value vs. Eaton Vance Senior
Performance |
| Timeline |
| Invesco California Value |
| Eaton Vance Senior |
Invesco California and Eaton Vance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Invesco California and Eaton Vance
The main advantage of trading using opposite Invesco California and Eaton Vance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Invesco California 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.| Invesco California vs. Pimco California Municipal | Invesco California vs. Invesco Pennsylvania Value | Invesco California vs. Nuveen California Dividend | Invesco California vs. Invesco Advantage MIT |
| Eaton Vance vs. MFS Investment Grade | Eaton Vance vs. Invesco High Income | Eaton Vance vs. Eaton Vance National | Eaton Vance vs. Nuveen California Select |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
Other Complementary Tools
| Fundamental Analysis View fundamental data based on most recent published financial statements | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Stocks Directory Find actively traded stocks across global markets | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal |