Correlation Between Eaton Vance and Gabelli Equity
Can any of the company-specific risk be diversified away by investing in both Eaton Vance and Gabelli Equity 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 Eaton Vance and Gabelli Equity into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Eaton Vance Senior and The Gabelli Equity, you can compare the effects of market volatilities on Eaton Vance and Gabelli Equity 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 Eaton Vance with a short position of Gabelli Equity. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eaton Vance and Gabelli Equity.
Diversification Opportunities for Eaton Vance and Gabelli Equity
-0.24 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Eaton and Gabelli is -0.24. Overlapping area represents the amount of risk that can be diversified away by holding Eaton Vance Senior and The Gabelli Equity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gabelli Equity and Eaton Vance 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 Eaton Vance Senior are associated (or correlated) with Gabelli Equity. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gabelli Equity has no effect on the direction of Eaton Vance i.e., Eaton Vance and Gabelli Equity go up and down completely randomly.
Pair Corralation between Eaton Vance and Gabelli Equity
Considering the 90-day investment horizon Eaton Vance is expected to generate 3.29 times less return on investment than Gabelli Equity. But when comparing it to its historical volatility, Eaton Vance Senior is 1.55 times less risky than Gabelli Equity. It trades about 0.07 of its potential returns per unit of risk. The Gabelli Equity is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest 2,181 in The Gabelli Equity on August 29, 2024 and sell it today you would earn a total of 132.00 from holding The Gabelli Equity or generate 6.05% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Eaton Vance Senior vs. The Gabelli Equity
Performance |
| Timeline |
| Eaton Vance Senior |
| Gabelli Equity |
Eaton Vance and Gabelli Equity Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Eaton Vance and Gabelli Equity
The main advantage of trading using opposite Eaton Vance and Gabelli Equity positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eaton Vance position performs unexpectedly, Gabelli Equity 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 Equity will offset losses from the drop in Gabelli Equity's long position.| Eaton Vance vs. MFS Investment Grade | Eaton Vance vs. Invesco High Income | Eaton Vance vs. Eaton Vance National | Eaton Vance vs. Nuveen California Select |
| Gabelli Equity vs. Virtus AllianzGI Convertible | Gabelli Equity vs. The Gabelli Equity | Gabelli Equity vs. Oxford Lane Capital | Gabelli Equity vs. The Gabelli Multimedia |
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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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