Correlation Between Gabelli Equity and Payden Emerging
Can any of the company-specific risk be diversified away by investing in both Gabelli Equity and Payden Emerging 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 Payden Emerging 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 Payden Emerging Markets, you can compare the effects of market volatilities on Gabelli Equity and Payden Emerging 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 Payden Emerging. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gabelli Equity and Payden Emerging.
Diversification Opportunities for Gabelli Equity and Payden Emerging
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Gabelli and Payden is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding Gabelli Equity Trust and Payden Emerging Markets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Payden Emerging Markets 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 Payden Emerging. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Payden Emerging Markets has no effect on the direction of Gabelli Equity i.e., Gabelli Equity and Payden Emerging go up and down completely randomly.
Pair Corralation between Gabelli Equity and Payden Emerging
Considering the 90-day investment horizon Gabelli Equity Trust is expected to generate 1.46 times more return on investment than Payden Emerging. However, Gabelli Equity is 1.46 times more volatile than Payden Emerging Markets. It trades about 0.47 of its potential returns per unit of risk. Payden Emerging Markets is currently generating about -0.09 per unit of risk. If you would invest 537.00 in Gabelli Equity Trust on September 1, 2024 and sell it today you would earn a total of 42.00 from holding Gabelli Equity Trust or generate 7.82% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Gabelli Equity Trust vs. Payden Emerging Markets
Performance |
| Timeline |
| Gabelli Equity Trust |
| Payden Emerging Markets |
Gabelli Equity and Payden Emerging Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gabelli Equity and Payden Emerging
The main advantage of trading using opposite Gabelli Equity and Payden Emerging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gabelli Equity position performs unexpectedly, Payden Emerging 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 Payden Emerging will offset losses from the drop in Payden Emerging'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 |
| Payden Emerging vs. Payden Porate Bond | Payden Emerging vs. Payden Absolute Return | Payden Emerging vs. Payden Absolute Return | Payden Emerging vs. Payden Emerging Markets |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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