Correlation Between Calamos Vertible and Columbia Convertible

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

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

Diversification Opportunities for Calamos Vertible and Columbia Convertible

1.0

Correlation Coefficient

Calamos Vertible  Columbia Convertible

No risk reduction

The 3 months correlation between Calamos and Columbia is 1.0. Overlapping area represents the amount of risk that can be diversified away by holding Calamos Vertible Fund and Columbia Vertible Securities in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Columbia Convertible and Calamos Vertible 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 Calamos Vertible Fund are associated (or correlated) with Columbia Convertible. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Columbia Convertible has no effect on the direction of Calamos Vertible i.e., Calamos Vertible and Columbia Convertible go up and down completely randomly.

Pair Corralation between Calamos Vertible and Columbia Convertible

Assuming the 90 days horizon Calamos Vertible Fund is expected to generate 1.08 times more return on investment than Columbia Convertible. However, Calamos Vertible is 1.08 times more volatile than Columbia Vertible Securities. It trades about 0.33 of its potential returns per unit of risk. Columbia Vertible Securities is currently generating about 0.32 per unit of risk. If you would invest  2,057  in Calamos Vertible Fund on August 31, 2024 and sell it today you would earn a total of  217.00  from holding Calamos Vertible Fund or generate 10.55% return on investment over 90 days.

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

Calamos Vertible Fund  vs.  Columbia Vertible Securities

Calamos Vertible

Risk-Adjusted Performance

26 of 100

Strong

Compared to the overall equity markets, risk-adjusted returns on investments in Calamos Vertible Fund are ranked lower than 26 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak forward indicators, Calamos Vertible may actually be approaching a critical reversion point that can send shares even higher in December 2024.

Columbia Convertible

Risk-Adjusted Performance

25 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Columbia Vertible Securities are ranked lower than 25 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak forward indicators, Columbia Convertible may actually be approaching a critical reversion point that can send shares even higher in December 2024.

Pair Trading with Calamos Vertible and Columbia Convertible

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

The idea behind Calamos Vertible Fund and Columbia Vertible Securities 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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.