Correlation Between Washington Mutual and The Gabelli
Can any of the company-specific risk be diversified away by investing in both Washington Mutual and The Gabelli 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 Washington Mutual and The Gabelli into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Washington Mutual Investors and The Gabelli Global, you can compare the effects of market volatilities on Washington Mutual and The Gabelli 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 Washington Mutual with a short position of The Gabelli. Check out your portfolio center. Please also check ongoing floating volatility patterns of Washington Mutual and The Gabelli.
Diversification Opportunities for Washington Mutual and The Gabelli
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Washington and The is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding Washington Mutual Investors and The Gabelli Global in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gabelli Global and Washington Mutual 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 Washington Mutual Investors are associated (or correlated) with The Gabelli. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gabelli Global has no effect on the direction of Washington Mutual i.e., Washington Mutual and The Gabelli go up and down completely randomly.
Pair Corralation between Washington Mutual and The Gabelli
Assuming the 90 days horizon Washington Mutual Investors is expected to generate 1.24 times more return on investment than The Gabelli. However, Washington Mutual is 1.24 times more volatile than The Gabelli Global. It trades about 0.09 of its potential returns per unit of risk. The Gabelli Global is currently generating about 0.09 per unit of risk. If you would invest 5,863 in Washington Mutual Investors on November 3, 2024 and sell it today you would earn a total of 538.00 from holding Washington Mutual Investors or generate 9.18% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Washington Mutual Investors vs. The Gabelli Global
Performance |
| Timeline |
| Washington Mutual |
| Gabelli Global |
Washington Mutual and The Gabelli Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Washington Mutual and The Gabelli
The main advantage of trading using opposite Washington Mutual and The Gabelli positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Washington Mutual position performs unexpectedly, The Gabelli 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 The Gabelli will offset losses from the drop in The Gabelli's long position.| Washington Mutual vs. Amg Managers Centersquare | Washington Mutual vs. Tiaa Cref Real Estate | Washington Mutual vs. Deutsche Real Estate | Washington Mutual vs. Tiaa Cref Real Estate |
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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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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