Correlation Between Calvert Small and Lincoln Inflation
Can any of the company-specific risk be diversified away by investing in both Calvert Small and Lincoln Inflation 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 Small and Lincoln Inflation into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Calvert Small Cap and Lincoln Inflation Plus, you can compare the effects of market volatilities on Calvert Small and Lincoln Inflation 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 Small with a short position of Lincoln Inflation. Check out your portfolio center. Please also check ongoing floating volatility patterns of Calvert Small and Lincoln Inflation.
Diversification Opportunities for Calvert Small and Lincoln Inflation
0.39 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Calvert and Lincoln is 0.39. Overlapping area represents the amount of risk that can be diversified away by holding Calvert Small Cap and Lincoln Inflation Plus in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lincoln Inflation Plus and Calvert Small 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 Small Cap are associated (or correlated) with Lincoln Inflation. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lincoln Inflation Plus has no effect on the direction of Calvert Small i.e., Calvert Small and Lincoln Inflation go up and down completely randomly.
Pair Corralation between Calvert Small and Lincoln Inflation
Assuming the 90 days horizon Calvert Small Cap is expected to generate 3.47 times more return on investment than Lincoln Inflation. However, Calvert Small is 3.47 times more volatile than Lincoln Inflation Plus. It trades about 0.08 of its potential returns per unit of risk. Lincoln Inflation Plus is currently generating about 0.1 per unit of risk. If you would invest 3,626 in Calvert Small Cap on May 28, 2025 and sell it today you would earn a total of 133.00 from holding Calvert Small Cap or generate 3.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Calvert Small Cap vs. Lincoln Inflation Plus
Performance |
| Timeline |
| Calvert Small Cap |
| Lincoln Inflation Plus |
Calvert Small and Lincoln Inflation Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Calvert Small and Lincoln Inflation
The main advantage of trading using opposite Calvert Small and Lincoln Inflation positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Calvert Small position performs unexpectedly, Lincoln Inflation 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 Lincoln Inflation will offset losses from the drop in Lincoln Inflation's long position.| Calvert Small vs. Calvert Equity Portfolio | Calvert Small vs. Calvert Emerging Markets | Calvert Small vs. Calvert Large Cap | Calvert Small vs. Calvert Short Duration |
| Lincoln Inflation vs. Financials Ultrasector Profund | Lincoln Inflation vs. Financial Industries Fund | Lincoln Inflation vs. Gabelli Global Financial | Lincoln Inflation vs. Rmb Mendon Financial |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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