Correlation Between Ab Global and Calamos Growth

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

By analyzing existing cross correlation between Ab Global Risk and Calamos Growth Fund, you can compare the effects of market volatilities on Ab Global and Calamos Growth 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 Ab Global with a short position of Calamos Growth. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ab Global and Calamos Growth.

Diversification Opportunities for Ab Global and Calamos Growth

0.47

Correlation Coefficient

Ab Global  Calamos Growth

Very weak diversification

The 3 months correlation between CABIX and Calamos is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding Ab Global Risk and Calamos Growth Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Calamos Growth and Ab Global 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 Ab Global Risk are associated (or correlated) with Calamos Growth. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Calamos Growth has no effect on the direction of Ab Global i.e., Ab Global and Calamos Growth go up and down completely randomly.

Pair Corralation between Ab Global and Calamos Growth

Assuming the 90 days horizon Ab Global Risk is expected to under-perform the Calamos Growth. But the mutual fund apears to be less risky and, when comparing its historical volatility, Ab Global Risk is 1.6 times less risky than Calamos Growth. The mutual fund trades about -0.01 of its potential returns per unit of risk. The Calamos Growth Fund is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest  1,170  in Calamos Growth Fund on October 6, 2024 and sell it today you would earn a total of  252.00  from holding Calamos Growth Fund or generate 21.54% return on investment over 90 days.

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

Ab Global Risk  vs.  Calamos Growth Fund

Ab Global Risk

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Ab Global Risk has generated negative risk-adjusted returns adding no value to fund investors. In spite of weak performance in the last few months, the Fund's forward indicators remain fairly strong which may send shares a bit higher in February 2025. The current disturbance may also be a sign of long term up-swing for the fund investors.

Calamos Growth

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Calamos Growth Fund has generated negative risk-adjusted returns adding no value to fund investors. In spite of latest weak performance, the Fund's fundamental indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the fund investors.

Pair Trading with Ab Global and Calamos Growth

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

The idea behind Ab Global Risk and Calamos Growth Fund 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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.