Correlation Between Eaton Vance and Eaton Vance

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

By analyzing existing cross correlation between Eaton Vance Limited and Eaton Vance Tax Managed, you can compare the effects of market volatilities on Eaton Vance and Eaton Vance 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 Eaton Vance with a short position of Eaton Vance. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eaton Vance and Eaton Vance.

Diversification Opportunities for Eaton Vance and Eaton Vance

0.83

Correlation Coefficient

Eaton Vance  Eaton Vance

Very poor diversification

The 3 months correlation between Eaton and Eaton is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Eaton Vance Limited and Eaton Vance Tax Managed in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eaton Vance Tax and Eaton Vance 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 Eaton Vance Limited are associated (or correlated) with Eaton Vance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eaton Vance Tax has no effect on the direction of Eaton Vance i.e., Eaton Vance and Eaton Vance go up and down completely randomly.

Pair Corralation between Eaton Vance and Eaton Vance

Considering the 90-day investment horizon Eaton Vance Limited is expected to generate 0.87 times more return on investment than Eaton Vance. However, Eaton Vance Limited is 1.15 times less risky than Eaton Vance. It trades about 0.19 of its potential returns per unit of risk. Eaton Vance Tax Managed is currently generating about 0.14 per unit of risk. If you would invest  981.00  in Eaton Vance Limited on December 2, 2024 and sell it today you would earn a total of  44.00  from holding Eaton Vance Limited or generate 4.49% return on investment over 90 days.

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

Eaton Vance Limited  vs.  Eaton Vance Tax Managed

Eaton Vance Limited

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Eaton Vance Limited are ranked lower than 4 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly stable basic indicators, Eaton Vance is not utilizing all of its potentials. The current stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Eaton Vance Tax

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Eaton Vance Tax Managed are ranked lower than 2 (%) of all funds and portfolios of funds over the last 90 days. Despite nearly stable basic indicators, Eaton Vance is not utilizing all of its potentials. The latest stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Eaton Vance and Eaton Vance

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

The idea behind Eaton Vance Limited and Eaton Vance Tax Managed 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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.