Correlation Between Smallcap Fund and Calvert Equity
Can any of the company-specific risk be diversified away by investing in both Smallcap Fund and Calvert Equity 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 Smallcap Fund and Calvert Equity into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Smallcap Fund Fka and Calvert Equity Portfolio, you can compare the effects of market volatilities on Smallcap Fund and Calvert Equity 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 Smallcap Fund with a short position of Calvert Equity. Check out your portfolio center. Please also check ongoing floating volatility patterns of Smallcap Fund and Calvert Equity.
Diversification Opportunities for Smallcap Fund and Calvert Equity
0.97 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Smallcap and Calvert is 0.97. Overlapping area represents the amount of risk that can be diversified away by holding Smallcap Fund Fka and Calvert Equity Portfolio in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Calvert Equity Portfolio and Smallcap Fund 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 Smallcap Fund Fka are associated (or correlated) with Calvert Equity. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Calvert Equity Portfolio has no effect on the direction of Smallcap Fund i.e., Smallcap Fund and Calvert Equity go up and down completely randomly.
Pair Corralation between Smallcap Fund and Calvert Equity
Assuming the 90 days horizon Smallcap Fund Fka is expected to generate 1.38 times more return on investment than Calvert Equity. However, Smallcap Fund is 1.38 times more volatile than Calvert Equity Portfolio. It trades about 0.07 of its potential returns per unit of risk. Calvert Equity Portfolio is currently generating about 0.06 per unit of risk. If you would invest 2,310 in Smallcap Fund Fka on April 9, 2025 and sell it today you would earn a total of 251.00 from holding Smallcap Fund Fka or generate 10.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Smallcap Fund Fka vs. Calvert Equity Portfolio
Performance |
| Timeline |
| Smallcap Fund Fka |
| Calvert Equity Portfolio |
Smallcap Fund and Calvert Equity Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Smallcap Fund and Calvert Equity
The main advantage of trading using opposite Smallcap Fund and Calvert Equity positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Smallcap Fund position performs unexpectedly, Calvert Equity 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 Equity will offset losses from the drop in Calvert Equity's long position.| Smallcap Fund vs. Columbia Vertible Securities | Smallcap Fund vs. Allianzgi Convertible Income | Smallcap Fund vs. Absolute Convertible Arbitrage | Smallcap Fund vs. Teton Vertible Securities |
| Calvert Equity vs. T Rowe Price | Calvert Equity vs. Virtus Multi Sector Short | Calvert Equity vs. Ab Select Longshort | Calvert Equity vs. Nuveen Equity Longshort |
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 Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
Other Complementary Tools
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
| Top Crypto Exchanges Search and analyze digital assets across top global cryptocurrency exchanges |