Correlation Between Calvert High and Calvert Global
Can any of the company-specific risk be diversified away by investing in both Calvert High and Calvert Global 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 High and Calvert Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Calvert High Yield and Calvert Global Water, you can compare the effects of market volatilities on Calvert High and Calvert Global 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 High with a short position of Calvert Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Calvert High and Calvert Global.
Diversification Opportunities for Calvert High and Calvert Global
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Calvert and Calvert is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Calvert High Yield and Calvert Global Water in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Calvert Global Water and Calvert High 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 High Yield are associated (or correlated) with Calvert Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Calvert Global Water has no effect on the direction of Calvert High i.e., Calvert High and Calvert Global go up and down completely randomly.
Pair Corralation between Calvert High and Calvert Global
Assuming the 90 days horizon Calvert High is expected to generate 3.74 times less return on investment than Calvert Global. But when comparing it to its historical volatility, Calvert High Yield is 5.46 times less risky than Calvert Global. It trades about 0.45 of its potential returns per unit of risk. Calvert Global Water is currently generating about 0.31 of returns per unit of risk over similar time horizon. If you would invest 2,475 in Calvert Global Water on April 7, 2025 and sell it today you would earn a total of 548.00 from holding Calvert Global Water or generate 22.14% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Calvert High Yield vs. Calvert Global Water
Performance |
| Timeline |
| Calvert High Yield |
| Calvert Global Water |
Calvert High and Calvert Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Calvert High and Calvert Global
The main advantage of trading using opposite Calvert High and Calvert Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Calvert High position performs unexpectedly, Calvert Global 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 Global will offset losses from the drop in Calvert Global's long position.| Calvert High vs. Schwab Government Money | Calvert High vs. Dunham Porategovernment Bond | Calvert High vs. Elfun Government Money | Calvert High vs. Blackrock Government Bond |
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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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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