Correlation Between American Express and Calvert Balanced
Can any of the company-specific risk be diversified away by investing in both American Express and Calvert Balanced 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 American Express and Calvert Balanced into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between American Express and Calvert Balanced Portfolio, you can compare the effects of market volatilities on American Express and Calvert Balanced 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 American Express with a short position of Calvert Balanced. Check out your portfolio center. Please also check ongoing floating volatility patterns of American Express and Calvert Balanced.
Diversification Opportunities for American Express and Calvert Balanced
0.84 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between American and Calvert is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding American Express and Calvert Balanced Portfolio in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Calvert Balanced Por and American Express 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 American Express are associated (or correlated) with Calvert Balanced. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Calvert Balanced Por has no effect on the direction of American Express i.e., American Express and Calvert Balanced go up and down completely randomly.
Pair Corralation between American Express and Calvert Balanced
Considering the 90-day investment horizon American Express is expected to generate 3.63 times more return on investment than Calvert Balanced. However, American Express is 3.63 times more volatile than Calvert Balanced Portfolio. It trades about 0.13 of its potential returns per unit of risk. Calvert Balanced Portfolio is currently generating about 0.09 per unit of risk. If you would invest 31,082 in American Express on July 25, 2025 and sell it today you would earn a total of 4,118 from holding American Express or generate 13.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 98.44% |
| Values | Daily Returns |
American Express vs. Calvert Balanced Portfolio
Performance |
| Timeline |
| American Express |
| Calvert Balanced Por |
American Express and Calvert Balanced Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with American Express and Calvert Balanced
The main advantage of trading using opposite American Express and Calvert Balanced positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if American Express position performs unexpectedly, Calvert Balanced 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 Calvert Balanced will offset losses from the drop in Calvert Balanced's long position.| American Express vs. Mastercard | American Express vs. Visa Class A | American Express vs. Wells Fargo | American Express vs. Caterpillar |
| Calvert Balanced vs. Mid Cap Growth | Calvert Balanced vs. Fidelity Advisor Value | Calvert Balanced vs. Goldman Sachs Smallmid | Calvert Balanced vs. Transamerica Capital Growth |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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