Correlation Between Westwood Market and Calamos Dynamic
Can any of the company-specific risk be diversified away by investing in both Westwood Market and Calamos Dynamic 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 Westwood Market and Calamos Dynamic into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Westwood Market Neutral and Calamos Dynamic Convertible, you can compare the effects of market volatilities on Westwood Market and Calamos Dynamic 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 Westwood Market with a short position of Calamos Dynamic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Westwood Market and Calamos Dynamic.
Diversification Opportunities for Westwood Market and Calamos Dynamic
0.21 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Westwood and Calamos is 0.21. Overlapping area represents the amount of risk that can be diversified away by holding Westwood Market Neutral and Calamos Dynamic Convertible in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Calamos Dynamic Conv and Westwood Market 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 Westwood Market Neutral are associated (or correlated) with Calamos Dynamic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Calamos Dynamic Conv has no effect on the direction of Westwood Market i.e., Westwood Market and Calamos Dynamic go up and down completely randomly.
Pair Corralation between Westwood Market and Calamos Dynamic
Assuming the 90 days horizon Westwood Market Neutral is expected to generate 0.11 times more return on investment than Calamos Dynamic. However, Westwood Market Neutral is 9.0 times less risky than Calamos Dynamic. It trades about 0.26 of its potential returns per unit of risk. Calamos Dynamic Convertible is currently generating about -0.03 per unit of risk. If you would invest 966.00 in Westwood Market Neutral on December 3, 2024 and sell it today you would earn a total of 15.00 from holding Westwood Market Neutral or generate 1.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Westwood Market Neutral vs. Calamos Dynamic Convertible
Performance |
| Timeline |
| Westwood Market Neutral |
| Calamos Dynamic Conv |
Westwood Market and Calamos Dynamic Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Westwood Market and Calamos Dynamic
The main advantage of trading using opposite Westwood Market and Calamos Dynamic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Westwood Market position performs unexpectedly, Calamos Dynamic 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 Dynamic will offset losses from the drop in Calamos Dynamic's long position.| Westwood Market vs. Dunham Porategovernment Bond | Westwood Market vs. Virtus Seix Government | Westwood Market vs. Federated Government Income | Westwood Market vs. Us Government Securities |
| Calamos Dynamic vs. Calamos Convertible Opportunities | Calamos Dynamic vs. Calamos Global Dynamic | Calamos Dynamic vs. Calamos Strategic Total | Calamos Dynamic vs. Calamos LongShort Equity |
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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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