Correlation Between Calvert Aggressive and Aston/crosswind Small

Can any of the company-specific risk be diversified away by investing in both Calvert Aggressive and Aston/crosswind Small 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 Aggressive and Aston/crosswind Small into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Calvert Aggressive Allocation and Astoncrosswind Small Cap, you can compare the effects of market volatilities on Calvert Aggressive and Aston/crosswind Small 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 Aggressive with a short position of Aston/crosswind Small. Check out your portfolio center. Please also check ongoing floating volatility patterns of Calvert Aggressive and Aston/crosswind Small.

Diversification Opportunities for Calvert Aggressive and Aston/crosswind Small

0.78

Correlation Coefficient

Calvert Aggressive  Aston/crosswind Small

Poor diversification

The 3 months correlation between Calvert and Aston/crosswind is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding Calvert Aggressive Allocation and Astoncrosswind Small Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Astoncrosswind Small Cap and Calvert Aggressive 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 Aggressive Allocation are associated (or correlated) with Aston/crosswind Small. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Astoncrosswind Small Cap has no effect on the direction of Calvert Aggressive i.e., Calvert Aggressive and Aston/crosswind Small go up and down completely randomly.

Pair Corralation between Calvert Aggressive and Aston/crosswind Small

Assuming the 90 days horizon Calvert Aggressive Allocation is expected to under-perform the Aston/crosswind Small. But the mutual fund apears to be less risky and, when comparing its historical volatility, Calvert Aggressive Allocation is 1.71 times less risky than Aston/crosswind Small. The mutual fund trades about 0.0 of its potential returns per unit of risk. The Astoncrosswind Small Cap is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest  1,710  in Astoncrosswind Small Cap on October 23, 2024 and sell it today you would earn a total of  118.00  from holding Astoncrosswind Small Cap or generate 6.9% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	98.36%
Values	Daily Returns

Calvert Aggressive Allocation  vs.  Astoncrosswind Small Cap

Calvert Aggressive

Risk-Adjusted Performance

0 of 100

Very Weak

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

Astoncrosswind Small Cap

Risk-Adjusted Performance

7 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Astoncrosswind Small Cap are ranked lower than 7 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak fundamental indicators, Aston/crosswind Small may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Pair Trading with Calvert Aggressive and Aston/crosswind Small

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

The idea behind Calvert Aggressive Allocation and Astoncrosswind Small 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.

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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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.