Correlation Between Gabelli Equity and Eaton Vance
Can any of the company-specific risk be diversified away by investing in both Gabelli Equity 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 Gabelli Equity and Eaton Vance into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between The Gabelli Equity and Eaton Vance Senior, you can compare the effects of market volatilities on Gabelli Equity 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 Gabelli Equity with a short position of Eaton Vance. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gabelli Equity and Eaton Vance.
Diversification Opportunities for Gabelli Equity and Eaton Vance
-0.16 | Correlation Coefficient |
Good diversification
The 3 months correlation between Gabelli and Eaton is -0.16. Overlapping area represents the amount of risk that can be diversified away by holding The Gabelli Equity and Eaton Vance Senior in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eaton Vance Senior and Gabelli Equity 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 The Gabelli Equity 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 Senior has no effect on the direction of Gabelli Equity i.e., Gabelli Equity and Eaton Vance go up and down completely randomly.
Pair Corralation between Gabelli Equity and Eaton Vance
Assuming the 90 days trading horizon The Gabelli Equity is expected to under-perform the Eaton Vance. But the preferred stock apears to be less risky and, when comparing its historical volatility, The Gabelli Equity is 1.14 times less risky than Eaton Vance. The preferred stock trades about -0.19 of its potential returns per unit of risk. The Eaton Vance Senior is currently generating about 0.2 of returns per unit of risk over similar time horizon. If you would invest 617.00 in Eaton Vance Senior on September 1, 2024 and sell it today you would earn a total of 12.00 from holding Eaton Vance Senior or generate 1.94% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
The Gabelli Equity vs. Eaton Vance Senior
Performance |
| Timeline |
| Gabelli Equity |
| Eaton Vance Senior |
Gabelli Equity and Eaton Vance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gabelli Equity and Eaton Vance
The main advantage of trading using opposite Gabelli Equity and Eaton Vance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gabelli Equity 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.| Gabelli Equity vs. Virtus AllianzGI Convertible | Gabelli Equity vs. The Gabelli Equity | Gabelli Equity vs. Oxford Lane Capital | Gabelli Equity vs. The Gabelli Utility |
| Eaton Vance vs. MFS Investment Grade | Eaton Vance vs. Invesco High Income | Eaton Vance vs. Eaton Vance National | Eaton Vance vs. Nuveen California Select |
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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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