Correlation Between Calvert Global and Basic Materials
Can any of the company-specific risk be diversified away by investing in both Calvert Global and Basic Materials 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 Calvert Global and Basic Materials into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Calvert Global Energy and Basic Materials Fund, you can compare the effects of market volatilities on Calvert Global and Basic Materials 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 Calvert Global with a short position of Basic Materials. Check out your portfolio center. Please also check ongoing floating volatility patterns of Calvert Global and Basic Materials.
Diversification Opportunities for Calvert Global and Basic Materials
0.96 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Calvert and Basic is 0.96. Overlapping area represents the amount of risk that can be diversified away by holding Calvert Global Energy and Basic Materials Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Basic Materials and Calvert Global 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 Calvert Global Energy are associated (or correlated) with Basic Materials. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Basic Materials has no effect on the direction of Calvert Global i.e., Calvert Global and Basic Materials go up and down completely randomly.
Pair Corralation between Calvert Global and Basic Materials
Assuming the 90 days horizon Calvert Global Energy is expected to generate 0.97 times more return on investment than Basic Materials. However, Calvert Global Energy is 1.03 times less risky than Basic Materials. It trades about 0.38 of its potential returns per unit of risk. Basic Materials Fund is currently generating about 0.23 per unit of risk. If you would invest 995.00 in Calvert Global Energy on April 9, 2025 and sell it today you would earn a total of 243.00 from holding Calvert Global Energy or generate 24.42% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Calvert Global Energy vs. Basic Materials Fund
Performance |
| Timeline |
| Calvert Global Energy |
| Basic Materials |
Calvert Global and Basic Materials Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Calvert Global and Basic Materials
The main advantage of trading using opposite Calvert Global and Basic Materials positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Calvert Global position performs unexpectedly, Basic Materials 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 Basic Materials will offset losses from the drop in Basic Materials' long position.| Calvert Global vs. Aqr Large Cap | Calvert Global vs. Upright Assets Allocation | Calvert Global vs. Aqr Large Cap | Calvert Global vs. Ab Global Risk |
| Basic Materials vs. Upright Assets Allocation | Basic Materials vs. Pnc Balanced Allocation | Basic Materials vs. Old Westbury Large | Basic Materials vs. Growth Allocation Fund |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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