Correlation Between Columbia Greater and Eaton Vance

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

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

Diversification Opportunities for Columbia Greater and Eaton Vance

-0.75

Correlation Coefficient

Columbia Greater  Eaton Vance

Pay attention - limited upside

The 3 months correlation between Columbia and Eaton is -0.75. Overlapping area represents the amount of risk that can be diversified away by holding Columbia Greater China and Eaton Vance Greater in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eaton Vance Greater and Columbia Greater 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 Columbia Greater China 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 Greater has no effect on the direction of Columbia Greater i.e., Columbia Greater and Eaton Vance go up and down completely randomly.

Pair Corralation between Columbia Greater and Eaton Vance

Assuming the 90 days horizon Columbia Greater China is expected to generate 1.6 times more return on investment than Eaton Vance. However, Columbia Greater is 1.6 times more volatile than Eaton Vance Greater. It trades about 0.15 of its potential returns per unit of risk. Eaton Vance Greater is currently generating about -0.11 per unit of risk. If you would invest  3,357  in Columbia Greater China on December 22, 2024 and sell it today you would earn a total of  485.00  from holding Columbia Greater China or generate 14.45% return on investment over 90 days.

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

Columbia Greater China  vs.  Eaton Vance Greater

Columbia Greater China

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Columbia Greater China are ranked lower than 11 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak basic indicators, Columbia Greater showed solid returns over the last few months and may actually be approaching a breakup point.

Eaton Vance Greater

Risk-Adjusted Performance

Very Weak

Over the last 90 days Eaton Vance Greater has generated negative risk-adjusted returns adding no value to fund investors. In spite of latest weak performance, the Fund's forward indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the fund investors.

Pair Trading with Columbia Greater and Eaton Vance

The main advantage of trading using opposite Columbia Greater and Eaton Vance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Columbia Greater 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 Columbia Greater China and Eaton Vance Greater 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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.