Correlation Between FT Cboe and Calvert International

Can any of the company-specific risk be diversified away by investing in both FT Cboe and Calvert International 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 FT Cboe and Calvert International into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between FT Cboe Vest and Calvert International Equity, you can compare the effects of market volatilities on FT Cboe and Calvert International 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 FT Cboe with a short position of Calvert International. Check out your portfolio center. Please also check ongoing floating volatility patterns of FT Cboe and Calvert International.

Diversification Opportunities for FT Cboe and Calvert International

0.66

Correlation Coefficient

FT Cboe  Calvert International

Poor diversification

The 3 months correlation between KNG and Calvert is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding FT Cboe Vest and Calvert International Equity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Calvert International and FT Cboe 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 FT Cboe Vest are associated (or correlated) with Calvert International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Calvert International has no effect on the direction of FT Cboe i.e., FT Cboe and Calvert International go up and down completely randomly.

Pair Corralation between FT Cboe and Calvert International

Considering the 90-day investment horizon FT Cboe Vest is expected to under-perform the Calvert International. But the etf apears to be less risky and, when comparing its historical volatility, FT Cboe Vest is 1.11 times less risky than Calvert International. The etf trades about -0.03 of its potential returns per unit of risk. The Calvert International Equity is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest  2,492  in Calvert International Equity on March 4, 2025 and sell it today you would earn a total of  160.00  from holding Calvert International Equity or generate 6.42% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	99.19%
Values	Daily Returns

FT Cboe Vest  vs.  Calvert International Equity

FT Cboe Vest

Risk-Adjusted Performance

Very Weak

Over the last 90 days FT Cboe Vest has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, FT Cboe is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Calvert International

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Calvert International Equity are ranked lower than 3 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, Calvert International is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with FT Cboe and Calvert International

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

The idea behind FT Cboe Vest and Calvert International Equity 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 CEOs Directory module to screen CEOs from public companies around the world.