Correlation Between Cisco Systems and Calvert Floating-rate
Can any of the company-specific risk be diversified away by investing in both Cisco Systems 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 Cisco Systems 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 Cisco Systems and Calvert Floating Rate Advantage, you can compare the effects of market volatilities on Cisco Systems 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 Cisco Systems with a short position of Calvert Floating-rate. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cisco Systems and Calvert Floating-rate.
Diversification Opportunities for Cisco Systems and Calvert Floating-rate
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Cisco and Calvert is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding Cisco Systems 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 Cisco Systems 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 Cisco Systems 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 Cisco Systems i.e., Cisco Systems and Calvert Floating-rate go up and down completely randomly.
Pair Corralation between Cisco Systems and Calvert Floating-rate
Given the investment horizon of 90 days Cisco Systems is expected to generate 7.94 times more return on investment than Calvert Floating-rate. However, Cisco Systems is 7.94 times more volatile than Calvert Floating Rate Advantage. It trades about 0.24 of its potential returns per unit of risk. Calvert Floating Rate Advantage is currently generating about 0.38 per unit of risk. If you would invest 5,686 in Cisco Systems on April 15, 2025 and sell it today you would earn a total of 1,109 from holding Cisco Systems or generate 19.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cisco Systems vs. Calvert Floating Rate Advantag
Performance |
| Timeline |
| Cisco Systems |
| Calvert Floating Rate |
Cisco Systems and Calvert Floating-rate Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cisco Systems and Calvert Floating-rate
The main advantage of trading using opposite Cisco Systems and Calvert Floating-rate positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cisco Systems 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.| Cisco Systems vs. Ciena Corp | Cisco Systems vs. Lumentum Holdings | Cisco Systems vs. NETGEAR | Cisco Systems vs. Mutual Of America |
| Calvert Floating-rate vs. Qs Growth Fund | Calvert Floating-rate vs. Transamerica Capital Growth | Calvert Floating-rate vs. Auer Growth Fund | Calvert Floating-rate vs. The Hartford 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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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