Correlation Between The National and Calvert Floating-rate
Can any of the company-specific risk be diversified away by investing in both The National and Calvert Floating-rate 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 The National and Calvert Floating-rate into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between The National Tax Free and Calvert Floating Rate Advantage, you can compare the effects of market volatilities on The National and Calvert Floating-rate 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 The National with a short position of Calvert Floating-rate. Check out your portfolio center. Please also check ongoing floating volatility patterns of The National and Calvert Floating-rate.
Diversification Opportunities for The National and Calvert Floating-rate
0.61 | Correlation Coefficient |
Poor diversification
The 3 months correlation between The and Calvert is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding The National Tax Free and Calvert Floating Rate Advantag in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Calvert Floating Rate and The National 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 The National Tax Free are associated (or correlated) with Calvert Floating-rate. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Calvert Floating Rate has no effect on the direction of The National i.e., The National and Calvert Floating-rate go up and down completely randomly.
Pair Corralation between The National and Calvert Floating-rate
Assuming the 90 days horizon The National is expected to generate 1.34 times less return on investment than Calvert Floating-rate. But when comparing it to its historical volatility, The National Tax Free is 1.15 times less risky than Calvert Floating-rate. It trades about 0.22 of its potential returns per unit of risk. Calvert Floating Rate Advantage is currently generating about 0.26 of returns per unit of risk over similar time horizon. If you would invest 857.00 in Calvert Floating Rate Advantage on May 27, 2025 and sell it today you would earn a total of 19.00 from holding Calvert Floating Rate Advantage or generate 2.22% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
The National Tax Free vs. Calvert Floating Rate Advantag
Performance |
| Timeline |
| National Tax |
Risk-Adjusted Performance
Solid
Weak | Strong |
| Calvert Floating Rate |
The National and Calvert Floating-rate Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with The National and Calvert Floating-rate
The main advantage of trading using opposite The National and Calvert Floating-rate positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if The National position performs unexpectedly, Calvert Floating-rate 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 Floating-rate will offset losses from the drop in Calvert Floating-rate's long position.| The National vs. The Missouri Tax Free | The National vs. The Bond Fund | The National vs. High Yield Municipal Fund | The National vs. Fidelity Intermediate Municipal |
| Calvert Floating-rate vs. Qs Large Cap | Calvert Floating-rate vs. Fabwx | Calvert Floating-rate vs. Abs Insights Emerging | Calvert Floating-rate vs. Wabmsx |
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 Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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