Correlation Between Nuveen California and Calamos Global

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

By analyzing existing cross correlation between Nuveen California Select and Calamos Global Dynamic, you can compare the effects of market volatilities on Nuveen California and Calamos Global 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 Nuveen California with a short position of Calamos Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nuveen California and Calamos Global.

Diversification Opportunities for Nuveen California and Calamos Global

0.19

Correlation Coefficient

Nuveen California  Calamos Global

Average diversification

The 3 months correlation between Nuveen and Calamos is 0.19. Overlapping area represents the amount of risk that can be diversified away by holding Nuveen California Select and Calamos Global Dynamic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Calamos Global Dynamic and Nuveen California 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 Nuveen California Select are associated (or correlated) with Calamos Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Calamos Global Dynamic has no effect on the direction of Nuveen California i.e., Nuveen California and Calamos Global go up and down completely randomly.

Pair Corralation between Nuveen California and Calamos Global

Considering the 90-day investment horizon Nuveen California is expected to generate 7.67 times less return on investment than Calamos Global. But when comparing it to its historical volatility, Nuveen California Select is 1.27 times less risky than Calamos Global. It trades about 0.02 of its potential returns per unit of risk. Calamos Global Dynamic is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest  674.00  in Calamos Global Dynamic on September 2, 2024 and sell it today you would earn a total of  33.00  from holding Calamos Global Dynamic or generate 4.9% return on investment over 90 days.

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

Nuveen California Select  vs.  Calamos Global Dynamic

Nuveen California Select

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Nuveen California Select are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound basic indicators, Nuveen California is not utilizing all of its potentials. The recent stock price tumult, may contribute to shorter-term losses for the shareholders.

Calamos Global Dynamic

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Calamos Global Dynamic are ranked lower than 7 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly stable technical indicators, Calamos Global is not utilizing all of its potentials. The newest stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Pair Trading with Nuveen California and Calamos Global

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

The idea behind Nuveen California Select and Calamos Global Dynamic 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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.