Correlation Between Calvert Equity and Schwab Government

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both Calvert Equity and Schwab Government 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 Equity and Schwab Government into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Calvert Equity Portfolio and Schwab Government Money, you can compare the effects of market volatilities on Calvert Equity and Schwab Government 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 Equity with a short position of Schwab Government. Check out your portfolio center. Please also check ongoing floating volatility patterns of Calvert Equity and Schwab Government.

Diversification Opportunities for Calvert Equity and Schwab Government

CalvertSchwabDiversified AwayCalvertSchwabDiversified Away100%
-0.6
  Correlation Coefficient

Excellent diversification

The 3 months correlation between Calvert and Schwab is -0.6. Overlapping area represents the amount of risk that can be diversified away by holding Calvert Equity Portfolio and Schwab Government Money in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Schwab Government Money and Calvert Equity 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 Equity Portfolio are associated (or correlated) with Schwab Government. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Schwab Government Money has no effect on the direction of Calvert Equity i.e., Calvert Equity and Schwab Government go up and down completely randomly.

Pair Corralation between Calvert Equity and Schwab Government

Assuming the 90 days horizon Calvert Equity Portfolio is expected to under-perform the Schwab Government. In addition to that, Calvert Equity is 17.78 times more volatile than Schwab Government Money. It trades about -0.1 of its total potential returns per unit of risk. Schwab Government Money is currently generating about 0.13 per unit of volatility. If you would invest  99.00  in Schwab Government Money on October 28, 2024 and sell it today you would earn a total of  1.00  from holding Schwab Government Money or generate 1.01% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthWeak
Accuracy96.83%
ValuesDaily Returns

Calvert Equity Portfolio  vs.  Schwab Government Money

 Performance 
JavaScript chart by amCharts 3.21.15NovDec2025 -20-15-10-50
JavaScript chart by amCharts 3.21.15CSECX SWGXX
       Timeline  
Calvert Equity Portfolio 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Calvert Equity Portfolio 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 fundamental 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.
JavaScript chart by amCharts 3.21.15NovDecJanDecJan323334353637383940
Schwab Government Money 

Risk-Adjusted Performance

9 of 100

 
Weak
 
Strong
OK
Compared to the overall equity markets, risk-adjusted returns on investments in Schwab Government Money are ranked lower than 9 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, Schwab Government is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.
JavaScript chart by amCharts 3.21.15NovDecJanDecJan0.990.9920.9940.9960.9981

Calvert Equity and Schwab Government Volatility Contrast

   Predicted Return Density   
JavaScript chart by amCharts 3.21.15-3.67-2.75-1.83-0.910.00.811.632.453.27 510152025
JavaScript chart by amCharts 3.21.15CSECX SWGXX
       Returns  

Pair Trading with Calvert Equity and Schwab Government

The main advantage of trading using opposite Calvert Equity and Schwab Government positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Calvert Equity position performs unexpectedly, Schwab Government 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 Schwab Government will offset losses from the drop in Schwab Government's long position.
The idea behind Calvert Equity Portfolio and Schwab Government Money 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.
Check out your portfolio center.
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.

Other Complementary Tools

Risk-Return Analysis
View associations between returns expected from investment and the risk you assume
Alpha Finder
Use alpha and beta coefficients to find investment opportunities after accounting for the risk
Balance Of Power
Check stock momentum by analyzing Balance Of Power indicator and other technical ratios
Analyst Advice
Analyst recommendations and target price estimates broken down by several categories
Money Flow Index
Determine momentum by analyzing Money Flow Index and other technical indicators


 

Trending Assets