Correlation Between Gabelli Equity and Old Westbury
Can any of the company-specific risk be diversified away by investing in both Gabelli Equity and Old Westbury 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 Old Westbury into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Gabelli Equity Trust and Old Westbury Small, you can compare the effects of market volatilities on Gabelli Equity and Old Westbury 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 Old Westbury. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gabelli Equity and Old Westbury.
Diversification Opportunities for Gabelli Equity and Old Westbury
0.81 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Gabelli and Old is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding Gabelli Equity Trust and Old Westbury Small in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Old Westbury Small 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 Gabelli Equity Trust are associated (or correlated) with Old Westbury. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Old Westbury Small has no effect on the direction of Gabelli Equity i.e., Gabelli Equity and Old Westbury go up and down completely randomly.
Pair Corralation between Gabelli Equity and Old Westbury
Considering the 90-day investment horizon Gabelli Equity is expected to generate 1.19 times less return on investment than Old Westbury. In addition to that, Gabelli Equity is 1.2 times more volatile than Old Westbury Small. It trades about 0.04 of its total potential returns per unit of risk. Old Westbury Small is currently generating about 0.06 per unit of volatility. If you would invest 1,390 in Old Westbury Small on August 28, 2024 and sell it today you would earn a total of 343.00 from holding Old Westbury Small or generate 24.68% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Gabelli Equity Trust vs. Old Westbury Small
Performance |
| Timeline |
| Gabelli Equity Trust |
| Old Westbury Small |
Gabelli Equity and Old Westbury Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gabelli Equity and Old Westbury
The main advantage of trading using opposite Gabelli Equity and Old Westbury positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gabelli Equity position performs unexpectedly, Old Westbury 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 Old Westbury will offset losses from the drop in Old Westbury's long position.| Gabelli Equity vs. Gabelli Utility Closed | Gabelli Equity vs. Gabelli MultiMedia Mutual | Gabelli Equity vs. Gabelli Healthcare WellnessRx | Gabelli Equity vs. Liberty All Star |
| Old Westbury vs. Aqr Large Cap | Old Westbury vs. Tax Managed Large Cap | Old Westbury vs. Touchstone Large Cap | Old Westbury vs. Federated Mdt Large |
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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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