Correlation Between Calamos Global and Virtus Dividend

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Can any of the company-specific risk be diversified away by investing in both Calamos Global and Virtus Dividend 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 Calamos Global and Virtus Dividend into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Calamos Global Dynamic and Virtus Dividend Interest, you can compare the effects of market volatilities on Calamos Global and Virtus Dividend 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 Calamos Global with a short position of Virtus Dividend. Check out your portfolio center. Please also check ongoing floating volatility patterns of Calamos Global and Virtus Dividend.

Diversification Opportunities for Calamos Global and Virtus Dividend

0.51
  Correlation Coefficient

Very weak diversification

The 3 months correlation between Calamos and Virtus is 0.51. Overlapping area represents the amount of risk that can be diversified away by holding Calamos Global Dynamic and Virtus Dividend Interest in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Virtus Dividend Interest and Calamos 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 Calamos Global Dynamic are associated (or correlated) with Virtus Dividend. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Virtus Dividend Interest has no effect on the direction of Calamos Global i.e., Calamos Global and Virtus Dividend go up and down completely randomly.

Pair Corralation between Calamos Global and Virtus Dividend

Considering the 90-day investment horizon Calamos Global Dynamic is expected to under-perform the Virtus Dividend. In addition to that, Calamos Global is 1.13 times more volatile than Virtus Dividend Interest. It trades about -0.22 of its total potential returns per unit of risk. Virtus Dividend Interest is currently generating about -0.12 per unit of volatility. If you would invest  1,270  in Virtus Dividend Interest on October 14, 2024 and sell it today you would lose (24.00) from holding Virtus Dividend Interest or give up 1.89% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthWeak
Accuracy100.0%
ValuesDaily Returns

Calamos Global Dynamic  vs.  Virtus Dividend Interest

 Performance 
       Timeline  
Calamos Global Dynamic 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Calamos Global Dynamic has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly stable technical indicators, Calamos Global is not utilizing all of its potentials. The current stock price fuss, may contribute to near-short-term losses for the sophisticated investors.
Virtus Dividend Interest 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Virtus Dividend Interest has generated negative risk-adjusted returns adding no value to fund investors. Even with relatively steady technical and fundamental indicators, Virtus Dividend is not utilizing all of its potentials. The latest stock price chaos, may contribute to medium-term losses for the stakeholders.

Calamos Global and Virtus Dividend Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Calamos Global and Virtus Dividend

The main advantage of trading using opposite Calamos Global and Virtus Dividend positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Calamos Global position performs unexpectedly, Virtus Dividend 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 Virtus Dividend will offset losses from the drop in Virtus Dividend's long position.
The idea behind Calamos Global Dynamic and Virtus Dividend Interest 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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.

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