Correlation Between Income Fund and Calamos Growth

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

By analyzing existing cross correlation between Income Fund Of and Calamos Growth Income, you can compare the effects of market volatilities on Income Fund and Calamos Growth 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 Income Fund with a short position of Calamos Growth. Check out your portfolio center. Please also check ongoing floating volatility patterns of Income Fund and Calamos Growth.

Diversification Opportunities for Income Fund and Calamos Growth

0.8

Correlation Coefficient

Income Fund  Calamos Growth

Very poor diversification

The 3 months correlation between Income and Calamos is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding Income Fund Of and Calamos Growth Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Calamos Growth Income and Income Fund 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 Income Fund Of are associated (or correlated) with Calamos Growth. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Calamos Growth Income has no effect on the direction of Income Fund i.e., Income Fund and Calamos Growth go up and down completely randomly.

Pair Corralation between Income Fund and Calamos Growth

Assuming the 90 days horizon Income Fund Of is expected to under-perform the Calamos Growth. But the mutual fund apears to be less risky and, when comparing its historical volatility, Income Fund Of is 1.19 times less risky than Calamos Growth. The mutual fund trades about -0.08 of its potential returns per unit of risk. The Calamos Growth Income is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest  5,145  in Calamos Growth Income on September 12, 2024 and sell it today you would earn a total of  52.00  from holding Calamos Growth Income or generate 1.01% return on investment over 90 days.

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

Income Fund Of  vs.  Calamos Growth Income

Income Fund

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Income Fund Of are ranked lower than 7 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong fundamental indicators, Income Fund is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Calamos Growth Income

Risk-Adjusted Performance

17 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Calamos Growth Income are ranked lower than 17 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak basic indicators, Calamos Growth may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with Income Fund and Calamos Growth

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

The idea behind Income Fund Of and Calamos Growth Income 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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.