Correlation Between Carillon Chartwell and Eagle Small

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

By analyzing existing cross correlation between Carillon Chartwell Small and Eagle Small Cap, you can compare the effects of market volatilities on Carillon Chartwell and Eagle Small 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 Carillon Chartwell with a short position of Eagle Small. Check out your portfolio center. Please also check ongoing floating volatility patterns of Carillon Chartwell and Eagle Small.

Diversification Opportunities for Carillon Chartwell and Eagle Small

0.95

Correlation Coefficient

Carillon Chartwell  Eagle Small

Almost no diversification

The 3 months correlation between Carillon and Eagle is 0.95. Overlapping area represents the amount of risk that can be diversified away by holding Carillon Chartwell Small and Eagle Small Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eagle Small Cap and Carillon Chartwell 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 Carillon Chartwell Small are associated (or correlated) with Eagle Small. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eagle Small Cap has no effect on the direction of Carillon Chartwell i.e., Carillon Chartwell and Eagle Small go up and down completely randomly.

Pair Corralation between Carillon Chartwell and Eagle Small

Assuming the 90 days horizon Carillon Chartwell Small is expected to generate 1.09 times more return on investment than Eagle Small. However, Carillon Chartwell is 1.09 times more volatile than Eagle Small Cap. It trades about 0.12 of its potential returns per unit of risk. Eagle Small Cap is currently generating about 0.12 per unit of risk. If you would invest  2,080  in Carillon Chartwell Small on August 30, 2024 and sell it today you would earn a total of  203.00  from holding Carillon Chartwell Small or generate 9.76% return on investment over 90 days.

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

Carillon Chartwell Small  vs.  Eagle Small Cap

Carillon Chartwell Small

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Carillon Chartwell Small are ranked lower than 9 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak technical indicators, Carillon Chartwell may actually be approaching a critical reversion point that can send shares even higher in December 2024.

Eagle Small Cap

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Eagle Small Cap are ranked lower than 9 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak fundamental indicators, Eagle Small may actually be approaching a critical reversion point that can send shares even higher in December 2024.

Pair Trading with Carillon Chartwell and Eagle Small

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

The idea behind Carillon Chartwell Small and Eagle Small Cap 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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.