Correlation Between Adams Diversified and Calamos Evolving

Can any of the company-specific risk be diversified away by investing in both Adams Diversified and Calamos Evolving 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 Adams Diversified and Calamos Evolving into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Adams Diversified Equity and Calamos Evolving World, you can compare the effects of market volatilities on Adams Diversified and Calamos Evolving 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 Adams Diversified with a short position of Calamos Evolving. Check out your portfolio center. Please also check ongoing floating volatility patterns of Adams Diversified and Calamos Evolving.

Diversification Opportunities for Adams Diversified and Calamos Evolving

0.08

Correlation Coefficient

Adams Diversified  Calamos Evolving

Significant diversification

The 3 months correlation between Adams and Calamos is 0.08. Overlapping area represents the amount of risk that can be diversified away by holding Adams Diversified Equity and Calamos Evolving World in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Calamos Evolving World and Adams Diversified 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 Adams Diversified Equity are associated (or correlated) with Calamos Evolving. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Calamos Evolving World has no effect on the direction of Adams Diversified i.e., Adams Diversified and Calamos Evolving go up and down completely randomly.

Pair Corralation between Adams Diversified and Calamos Evolving

Considering the 90-day investment horizon Adams Diversified Equity is expected to under-perform the Calamos Evolving. But the fund apears to be less risky and, when comparing its historical volatility, Adams Diversified Equity is 1.27 times less risky than Calamos Evolving. The fund trades about -0.05 of its potential returns per unit of risk. The Calamos Evolving World is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest  1,745  in Calamos Evolving World on December 28, 2024 and sell it today you would lose (11.00) from holding Calamos Evolving World or give up 0.63% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Adams Diversified Equity  vs.  Calamos Evolving World

Adams Diversified Equity

Risk-Adjusted Performance

Very Weak

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

Calamos Evolving World

Risk-Adjusted Performance

Very Weak

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

Pair Trading with Adams Diversified and Calamos Evolving

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

The idea behind Adams Diversified Equity and Calamos Evolving World 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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.