Correlation Between American Century and Calamos ETF

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

By analyzing existing cross correlation between American Century Quality and Calamos ETF Trust, you can compare the effects of market volatilities on American Century and Calamos ETF 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 American Century with a short position of Calamos ETF. Check out your portfolio center. Please also check ongoing floating volatility patterns of American Century and Calamos ETF.

Diversification Opportunities for American Century and Calamos ETF

0.65

Correlation Coefficient

American Century  Calamos ETF

Poor diversification

The 3 months correlation between American and Calamos is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding American Century Quality and Calamos ETF Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Calamos ETF Trust and American Century 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 American Century Quality are associated (or correlated) with Calamos ETF. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Calamos ETF Trust has no effect on the direction of American Century i.e., American Century and Calamos ETF go up and down completely randomly.

Pair Corralation between American Century and Calamos ETF

Given the investment horizon of 90 days American Century Quality is expected to under-perform the Calamos ETF. But the etf apears to be less risky and, when comparing its historical volatility, American Century Quality is 20.99 times less risky than Calamos ETF. The etf trades about -0.05 of its potential returns per unit of risk. The Calamos ETF Trust is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest  3,014  in Calamos ETF Trust on December 29, 2024 and sell it today you would lose (131.00) from holding Calamos ETF Trust or give up 4.35% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	98.39%
Values	Daily Returns

American Century Quality  vs.  Calamos ETF Trust

American Century Quality

Risk-Adjusted Performance

Very Weak

Over the last 90 days American Century Quality has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy basic indicators, American Century is not utilizing all of its potentials. The current stock price disarray, may contribute to short-term losses for the investors.

Calamos ETF Trust

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Calamos ETF Trust are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively weak basic indicators, Calamos ETF unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with American Century and Calamos ETF

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

The idea behind American Century Quality and Calamos ETF Trust 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.

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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.