Correlation Between FT Cboe and Calamos Laddered

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

By analyzing existing cross correlation between FT Cboe Vest and Calamos Laddered SP, you can compare the effects of market volatilities on FT Cboe and Calamos Laddered 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 FT Cboe with a short position of Calamos Laddered. Check out your portfolio center. Please also check ongoing floating volatility patterns of FT Cboe and Calamos Laddered.

Diversification Opportunities for FT Cboe and Calamos Laddered

0.94

Correlation Coefficient

FT Cboe  Calamos Laddered

Almost no diversification

The 3 months correlation between DNOV and Calamos is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding FT Cboe Vest and Calamos Laddered SP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Calamos Laddered and FT Cboe 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 FT Cboe Vest are associated (or correlated) with Calamos Laddered. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Calamos Laddered has no effect on the direction of FT Cboe i.e., FT Cboe and Calamos Laddered go up and down completely randomly.

Pair Corralation between FT Cboe and Calamos Laddered

Given the investment horizon of 90 days FT Cboe Vest is expected to generate 0.04 times more return on investment than Calamos Laddered. However, FT Cboe Vest is 26.17 times less risky than Calamos Laddered. It trades about 0.12 of its potential returns per unit of risk. Calamos Laddered SP is currently generating about -0.11 per unit of risk. If you would invest  3,267  in FT Cboe Vest on September 20, 2024 and sell it today you would earn a total of  1,004  from holding FT Cboe Vest or generate 30.73% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Strong
Accuracy	14.72%
Values	Daily Returns

FT Cboe Vest  vs.  Calamos Laddered SP

FT Cboe Vest

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in FT Cboe Vest are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of fairly stable basic indicators, FT Cboe is not utilizing all of its potentials. The current stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Calamos Laddered

Risk-Adjusted Performance

0 of 100

Modest

Over the last 90 days Calamos Laddered SP has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Etf's basic indicators remain quite persistent which may send shares a bit higher in January 2025. The latest mess may also be a sign of long-standing up-swing for the ETF venture institutional investors.

Pair Trading with FT Cboe and Calamos Laddered

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

The idea behind FT Cboe Vest and Calamos Laddered SP 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 Transaction History module to view history of all your transactions and understand their impact on performance.