Correlation Between Financial and Eaton Vance
Can any of the company-specific risk be diversified away by investing in both Financial 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 Financial and Eaton Vance into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Financial 15 Split and Eaton Vance Senior, you can compare the effects of market volatilities on Financial 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 Financial with a short position of Eaton Vance. Check out your portfolio center. Please also check ongoing floating volatility patterns of Financial and Eaton Vance.
Diversification Opportunities for Financial and Eaton Vance
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Financial and Eaton is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding Financial 15 Split and Eaton Vance Senior in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eaton Vance Senior and Financial 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 Financial 15 Split 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 Senior has no effect on the direction of Financial i.e., Financial and Eaton Vance go up and down completely randomly.
Pair Corralation between Financial and Eaton Vance
Assuming the 90 days horizon Financial 15 Split is expected to under-perform the Eaton Vance. In addition to that, Financial is 5.64 times more volatile than Eaton Vance Senior. It trades about -0.03 of its total potential returns per unit of risk. Eaton Vance Senior is currently generating about -0.11 per unit of volatility. If you would invest 603.00 in Eaton Vance Senior on December 29, 2024 and sell it today you would lose (18.00) from holding Eaton Vance Senior or give up 2.99% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 96.72% |
Values | Daily Returns |
Financial 15 Split vs. Eaton Vance Senior
Performance |
Timeline |
Financial 15 Split |
Eaton Vance Senior |
Financial and Eaton Vance Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Financial and Eaton Vance
The main advantage of trading using opposite Financial and Eaton Vance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Financial 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.Financial vs. SEI Investments | Financial vs. Oxford Lane Capital | Financial vs. Blackstone Group | Financial vs. North American Financial |
Eaton Vance vs. MFS Investment Grade | Eaton Vance vs. Eaton Vance National | Eaton Vance vs. Nuveen California Select | Eaton Vance vs. Federated Premier Municipal |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
Other Complementary Tools
Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes | |
Content Syndication Quickly integrate customizable finance content to your own investment portal | |
Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk |