Correlation Between Brookfield Corp and Calamos LongShort

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

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

Diversification Opportunities for Brookfield Corp and Calamos LongShort

-0.28

Correlation Coefficient

Brookfield Corp  Calamos LongShort

Very good diversification

The 3 months correlation between Brookfield and Calamos is -0.28. Overlapping area represents the amount of risk that can be diversified away by holding Brookfield Corp and Calamos LongShort Equity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Calamos LongShort Equity and Brookfield Corp 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 Brookfield Corp are associated (or correlated) with Calamos LongShort. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Calamos LongShort Equity has no effect on the direction of Brookfield Corp i.e., Brookfield Corp and Calamos LongShort go up and down completely randomly.

Pair Corralation between Brookfield Corp and Calamos LongShort

Allowing for the 90-day total investment horizon Brookfield Corp is expected to under-perform the Calamos LongShort. In addition to that, Brookfield Corp is 3.2 times more volatile than Calamos LongShort Equity. It trades about -0.03 of its total potential returns per unit of risk. Calamos LongShort Equity is currently generating about 0.16 per unit of volatility. If you would invest  1,455  in Calamos LongShort Equity on December 29, 2024 and sell it today you would earn a total of  95.00  from holding Calamos LongShort Equity or generate 6.53% return on investment over 90 days.

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

Brookfield Corp  vs.  Calamos LongShort Equity

Brookfield Corp

Risk-Adjusted Performance

Very Weak

Over the last 90 days Brookfield Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy basic indicators, Brookfield Corp is not utilizing all of its potentials. The latest stock price disarray, may contribute to short-term losses for the investors.

Calamos LongShort Equity

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Calamos LongShort Equity are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. In spite of fairly inconsistent basic indicators, Calamos LongShort may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with Brookfield Corp and Calamos LongShort

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

The idea behind Brookfield Corp and Calamos LongShort Equity 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.

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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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.