Correlation Between T Rowe and Calamos Opportunistic

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

By analyzing existing cross correlation between T Rowe Price and Calamos Opportunistic Value, you can compare the effects of market volatilities on T Rowe and Calamos Opportunistic 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 T Rowe with a short position of Calamos Opportunistic. Check out your portfolio center. Please also check ongoing floating volatility patterns of T Rowe and Calamos Opportunistic.

Diversification Opportunities for T Rowe and Calamos Opportunistic

0.6

Correlation Coefficient

T Rowe  Calamos Opportunistic

Poor diversification

The 3 months correlation between PRINX and Calamos is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding T Rowe Price and Calamos Opportunistic Value in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Calamos Opportunistic and T Rowe 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 T Rowe Price are associated (or correlated) with Calamos Opportunistic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Calamos Opportunistic has no effect on the direction of T Rowe i.e., T Rowe and Calamos Opportunistic go up and down completely randomly.

Pair Corralation between T Rowe and Calamos Opportunistic

Assuming the 90 days horizon T Rowe is expected to generate 5.78 times less return on investment than Calamos Opportunistic. But when comparing it to its historical volatility, T Rowe Price is 3.51 times less risky than Calamos Opportunistic. It trades about 0.05 of its potential returns per unit of risk. Calamos Opportunistic Value is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest  1,595  in Calamos Opportunistic Value on October 10, 2024 and sell it today you would earn a total of  643.00  from holding Calamos Opportunistic Value or generate 40.31% return on investment over 90 days.

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

T Rowe Price  vs.  Calamos Opportunistic Value

T Rowe Price

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days T Rowe Price has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong basic indicators, T Rowe is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Calamos Opportunistic

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Calamos Opportunistic Value has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong forward indicators, Calamos Opportunistic is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with T Rowe and Calamos Opportunistic

The main advantage of trading using opposite T Rowe and Calamos Opportunistic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if T Rowe position performs unexpectedly, Calamos Opportunistic 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 Opportunistic will offset losses from the drop in Calamos Opportunistic's long position.

The idea behind T Rowe Price and Calamos Opportunistic Value 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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..