Correlation Between Navient Corp and Eaton Vance

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

By analyzing existing cross correlation between Navient Corp and Eaton Vance Floating, you can compare the effects of market volatilities on Navient Corp and Eaton Vance 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 Navient Corp with a short position of Eaton Vance. Check out your portfolio center. Please also check ongoing floating volatility patterns of Navient Corp and Eaton Vance.

Diversification Opportunities for Navient Corp and Eaton Vance

-0.65

Correlation Coefficient

Navient Corp  Eaton Vance

Excellent diversification

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

Pair Corralation between Navient Corp and Eaton Vance

Given the investment horizon of 90 days Navient Corp is expected to under-perform the Eaton Vance. In addition to that, Navient Corp is 2.74 times more volatile than Eaton Vance Floating. It trades about -0.08 of its total potential returns per unit of risk. Eaton Vance Floating is currently generating about 0.1 per unit of volatility. If you would invest  1,290  in Eaton Vance Floating on March 3, 2024 and sell it today you would earn a total of  48.00  from holding Eaton Vance Floating or generate 3.72% return on investment over 90 days.

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

Navient Corp  vs.  Eaton Vance Floating

Navient Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Navient Corp has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest abnormal performance, the Stock's basic indicators remain strong and the recent confusion on Wall Street may also be a sign of long-lasting gains for the firm traders.

Eaton Vance Floating

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Eaton Vance Floating are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable technical and fundamental indicators, Eaton Vance is not utilizing all of its potentials. The recent stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Navient Corp and Eaton Vance

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

The idea behind Navient Corp and Eaton Vance Floating 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 Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.