Correlation Between Calamos Convertible and Calamos Dynamic

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

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

Diversification Opportunities for Calamos Convertible and Calamos Dynamic

0.52

Correlation Coefficient

Calamos Convertible  Calamos Dynamic

Very weak diversification

The 3 months correlation between Calamos and Calamos is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding Calamos Convertible Opportunit and Calamos Dynamic Convertible in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Calamos Dynamic Conv and Calamos Convertible 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 Convertible Opportunities are associated (or correlated) with Calamos Dynamic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Calamos Dynamic Conv has no effect on the direction of Calamos Convertible i.e., Calamos Convertible and Calamos Dynamic go up and down completely randomly.

Pair Corralation between Calamos Convertible and Calamos Dynamic

Considering the 90-day investment horizon Calamos Convertible Opportunities is expected to generate 0.87 times more return on investment than Calamos Dynamic. However, Calamos Convertible Opportunities is 1.15 times less risky than Calamos Dynamic. It trades about 0.17 of its potential returns per unit of risk. Calamos Dynamic Convertible is currently generating about 0.04 per unit of risk. If you would invest  1,099  in Calamos Convertible Opportunities on August 31, 2024 and sell it today you would earn a total of  106.00  from holding Calamos Convertible Opportunities or generate 9.65% return on investment over 90 days.

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

Calamos Convertible Opportunit  vs.  Calamos Dynamic Convertible

Calamos Convertible

Risk-Adjusted Performance

13 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Calamos Convertible Opportunities are ranked lower than 13 (%) of all funds and portfolios of funds over the last 90 days. Despite fairly inconsistent technical indicators, Calamos Convertible may actually be approaching a critical reversion point that can send shares even higher in December 2024.

Calamos Dynamic Conv

Risk-Adjusted Performance

3 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Calamos Dynamic Convertible are ranked lower than 3 (%) of all funds and portfolios of funds over the last 90 days. In spite of rather sound fundamental indicators, Calamos Dynamic is not utilizing all of its potentials. The recent stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with Calamos Convertible and Calamos Dynamic

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

The idea behind Calamos Convertible Opportunities and Calamos Dynamic Convertible 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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.