Correlation Between Calamos Short-term and Inflation-protected

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

By analyzing existing cross correlation between Calamos Short Term Bond and Inflation Protected Bond Fund, you can compare the effects of market volatilities on Calamos Short-term and Inflation-protected 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 Short-term with a short position of Inflation-protected. Check out your portfolio center. Please also check ongoing floating volatility patterns of Calamos Short-term and Inflation-protected.

Diversification Opportunities for Calamos Short-term and Inflation-protected

0.08

Correlation Coefficient

Calamos Short-term  Inflation-protected

Significant diversification

The 3 months correlation between Calamos and Inflation-protected is 0.08. Overlapping area represents the amount of risk that can be diversified away by holding Calamos Short Term Bond and Inflation Protected Bond Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Inflation Protected and Calamos Short-term 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 Short Term Bond are associated (or correlated) with Inflation-protected. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Inflation Protected has no effect on the direction of Calamos Short-term i.e., Calamos Short-term and Inflation-protected go up and down completely randomly.

Pair Corralation between Calamos Short-term and Inflation-protected

Assuming the 90 days horizon Calamos Short-term is expected to generate 12.54 times less return on investment than Inflation-protected. But when comparing it to its historical volatility, Calamos Short Term Bond is 3.46 times less risky than Inflation-protected. It trades about 0.04 of its potential returns per unit of risk. Inflation Protected Bond Fund is currently generating about 0.16 of returns per unit of risk over similar time horizon. If you would invest  1,015  in Inflation Protected Bond Fund on September 2, 2024 and sell it today you would earn a total of  41.00  from holding Inflation Protected Bond Fund or generate 4.04% return on investment over 90 days.

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

Calamos Short Term Bond  vs.  Inflation Protected Bond Fund

Calamos Short Term

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Calamos Short Term Bond are ranked lower than 3 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong forward indicators, Calamos Short-term is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Inflation Protected

Risk-Adjusted Performance

12 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Inflation Protected Bond Fund are ranked lower than 12 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, Inflation-protected is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Calamos Short-term and Inflation-protected

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

The idea behind Calamos Short Term Bond and Inflation Protected Bond 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.

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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.