Correlation Between Embrace Change and Gabelli Global
Can any of the company-specific risk be diversified away by investing in both Embrace Change and Gabelli Global 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 Embrace Change and Gabelli Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Embrace Change Acquisition and Gabelli Global Small, you can compare the effects of market volatilities on Embrace Change and Gabelli Global 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 Embrace Change with a short position of Gabelli Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Embrace Change and Gabelli Global.
Diversification Opportunities for Embrace Change and Gabelli Global
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Embrace and Gabelli is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding Embrace Change Acquisition and Gabelli Global Small in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gabelli Global Small and Embrace Change 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 Embrace Change Acquisition are associated (or correlated) with Gabelli Global. 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 Small has no effect on the direction of Embrace Change i.e., Embrace Change and Gabelli Global go up and down completely randomly.
Pair Corralation between Embrace Change and Gabelli Global
Assuming the 90 days horizon Embrace Change Acquisition is expected to under-perform the Gabelli Global. But the stock apears to be less risky and, when comparing its historical volatility, Embrace Change Acquisition is 12.77 times less risky than Gabelli Global. The stock trades about -0.15 of its potential returns per unit of risk. The Gabelli Global Small is currently generating about 0.2 of returns per unit of risk over similar time horizon. If you would invest 1,217 in Gabelli Global Small on September 3, 2024 and sell it today you would earn a total of 88.00 from holding Gabelli Global Small or generate 7.23% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Embrace Change Acquisition vs. Gabelli Global Small
Performance |
| Timeline |
| Embrace Change Acqui |
| Gabelli Global Small |
Embrace Change and Gabelli Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Embrace Change and Gabelli Global
The main advantage of trading using opposite Embrace Change and Gabelli Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Embrace Change position performs unexpectedly, Gabelli Global 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 Gabelli Global will offset losses from the drop in Gabelli Global's long position.| Embrace Change vs. Marblegate Acquisition Corp | Embrace Change vs. Alpha One | Embrace Change vs. Manaris Corp | Embrace Change vs. SCOR PK |
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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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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