Correlation Between Carlyle and Calamos LongShort

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

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

Diversification Opportunities for Carlyle and Calamos LongShort

0.29

Correlation Coefficient

Carlyle  Calamos LongShort

Modest diversification

The 3 months correlation between Carlyle and Calamos is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding Carlyle Group 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 Carlyle 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 Carlyle Group 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 Carlyle i.e., Carlyle and Calamos LongShort go up and down completely randomly.

Pair Corralation between Carlyle and Calamos LongShort

Allowing for the 90-day total investment horizon Carlyle Group is expected to under-perform the Calamos LongShort. In addition to that, Carlyle is 5.48 times more volatile than Calamos LongShort Equity. It trades about -0.25 of its total potential returns per unit of risk. Calamos LongShort Equity is currently generating about -0.03 per unit of volatility. If you would invest  1,555  in Calamos LongShort Equity on December 1, 2024 and sell it today you would lose (4.00) from holding Calamos LongShort Equity or give up 0.26% of portfolio value over 90 days.

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

Carlyle Group  vs.  Calamos LongShort Equity

Carlyle Group

Risk-Adjusted Performance

Very Weak

Over the last 90 days Carlyle Group has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable technical and fundamental indicators, Carlyle is not utilizing all of its potentials. The recent stock price disturbance, may contribute to mid-run losses for the stockholders.

Calamos LongShort Equity

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Calamos LongShort Equity are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of fairly strong basic indicators, Calamos LongShort is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Carlyle and Calamos LongShort

The main advantage of trading using opposite Carlyle and Calamos LongShort positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Carlyle 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 Carlyle Group 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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..