Correlation Between Americafirst Tactical and Calvert Large

Can any of the company-specific risk be diversified away by investing in both Americafirst Tactical and Calvert Large 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 Americafirst Tactical and Calvert Large into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Americafirst Tactical Alpha and Calvert Large Cap, you can compare the effects of market volatilities on Americafirst Tactical and Calvert Large 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 Americafirst Tactical with a short position of Calvert Large. Check out your portfolio center. Please also check ongoing floating volatility patterns of Americafirst Tactical and Calvert Large.

Diversification Opportunities for Americafirst Tactical and Calvert Large

0.12

Correlation Coefficient

Americafirst Tactical  Calvert Large

Average diversification

The 3 months correlation between Americafirst and Calvert is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding Americafirst Tactical Alpha and Calvert Large Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Calvert Large Cap and Americafirst Tactical 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 Americafirst Tactical Alpha are associated (or correlated) with Calvert Large. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Calvert Large Cap has no effect on the direction of Americafirst Tactical i.e., Americafirst Tactical and Calvert Large go up and down completely randomly.

Pair Corralation between Americafirst Tactical and Calvert Large

Assuming the 90 days horizon Americafirst Tactical Alpha is expected to generate 11.23 times more return on investment than Calvert Large. However, Americafirst Tactical is 11.23 times more volatile than Calvert Large Cap. It trades about 0.16 of its potential returns per unit of risk. Calvert Large Cap is currently generating about -0.08 per unit of risk. If you would invest  1,475  in Americafirst Tactical Alpha on October 6, 2024 and sell it today you would earn a total of  175.00  from holding Americafirst Tactical Alpha or generate 11.86% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	97.62%
Values	Daily Returns

Americafirst Tactical Alpha  vs.  Calvert Large Cap

Americafirst Tactical

Risk-Adjusted Performance

12 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Americafirst Tactical Alpha are ranked lower than 12 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak technical and fundamental indicators, Americafirst Tactical showed solid returns over the last few months and may actually be approaching a breakup point.

Calvert Large Cap

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Calvert Large Cap has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong technical and fundamental indicators, Calvert Large is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Americafirst Tactical and Calvert Large

The main advantage of trading using opposite Americafirst Tactical and Calvert Large positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Americafirst Tactical position performs unexpectedly, Calvert Large 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 Large will offset losses from the drop in Calvert Large's long position.

The idea behind Americafirst Tactical Alpha and Calvert Large Cap pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.