Correlation Between Calvert Bond and Growth Allocation
Can any of the company-specific risk be diversified away by investing in both Calvert Bond and Growth Allocation 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 Bond and Growth Allocation into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Calvert Bond Portfolio and Growth Allocation Fund, you can compare the effects of market volatilities on Calvert Bond and Growth Allocation 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 Bond with a short position of Growth Allocation. Check out your portfolio center. Please also check ongoing floating volatility patterns of Calvert Bond and Growth Allocation.
Diversification Opportunities for Calvert Bond and Growth Allocation
0.33 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Calvert and Growth is 0.33. Overlapping area represents the amount of risk that can be diversified away by holding Calvert Bond Portfolio and Growth Allocation Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Growth Allocation and Calvert Bond 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 Bond Portfolio are associated (or correlated) with Growth Allocation. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Growth Allocation has no effect on the direction of Calvert Bond i.e., Calvert Bond and Growth Allocation go up and down completely randomly.
Pair Corralation between Calvert Bond and Growth Allocation
Assuming the 90 days horizon Calvert Bond is expected to generate 9.35 times less return on investment than Growth Allocation. But when comparing it to its historical volatility, Calvert Bond Portfolio is 3.49 times less risky than Growth Allocation. It trades about 0.04 of its potential returns per unit of risk. Growth Allocation Fund is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 1,270 in Growth Allocation Fund on March 29, 2025 and sell it today you would earn a total of 94.00 from holding Growth Allocation Fund or generate 7.4% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 98.39% |
| Values | Daily Returns |
Calvert Bond Portfolio vs. Growth Allocation Fund
Performance |
| Timeline |
| Calvert Bond Portfolio |
| Growth Allocation |
Calvert Bond and Growth Allocation Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Calvert Bond and Growth Allocation
The main advantage of trading using opposite Calvert Bond and Growth Allocation positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Calvert Bond position performs unexpectedly, Growth Allocation 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 Growth Allocation will offset losses from the drop in Growth Allocation's long position.| Calvert Bond vs. Schwab Government Money | Calvert Bond vs. Intermediate Government Bond | Calvert Bond vs. Elfun Government Money | Calvert Bond vs. Prudential Government Money |
| Growth Allocation vs. Old Westbury Fixed | Growth Allocation vs. Ab Global Bond | Growth Allocation vs. Multisector Bond Sma | Growth Allocation vs. Ab Bond Inflation |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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