Correlation Between Gamco Global and American Beacon
Can any of the company-specific risk be diversified away by investing in both Gamco Global and American Beacon 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 Gamco Global and American Beacon into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Gamco Global Telecommunications and American Beacon Sim, you can compare the effects of market volatilities on Gamco Global and American Beacon 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 Gamco Global with a short position of American Beacon. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gamco Global and American Beacon.
Diversification Opportunities for Gamco Global and American Beacon
0.48 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Gamco and American is 0.48. Overlapping area represents the amount of risk that can be diversified away by holding Gamco Global Telecommunication and American Beacon Sim in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on American Beacon Sim and Gamco Global 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 Gamco Global Telecommunications are associated (or correlated) with American Beacon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of American Beacon Sim has no effect on the direction of Gamco Global i.e., Gamco Global and American Beacon go up and down completely randomly.
Pair Corralation between Gamco Global and American Beacon
Assuming the 90 days horizon Gamco Global Telecommunications is expected to generate 3.45 times more return on investment than American Beacon. However, Gamco Global is 3.45 times more volatile than American Beacon Sim. It trades about 0.1 of its potential returns per unit of risk. American Beacon Sim is currently generating about 0.18 per unit of risk. If you would invest 1,547 in Gamco Global Telecommunications on December 4, 2024 and sell it today you would earn a total of 725.00 from holding Gamco Global Telecommunications or generate 46.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.8% |
| Values | Daily Returns |
Gamco Global Telecommunication vs. American Beacon Sim
Performance |
| Timeline |
| Gamco Global Telecom |
| American Beacon Sim |
Gamco Global and American Beacon Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gamco Global and American Beacon
The main advantage of trading using opposite Gamco Global and American Beacon positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gamco Global position performs unexpectedly, American Beacon 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 American Beacon will offset losses from the drop in American Beacon's long position.| Gamco Global vs. Vanguard Energy Index | Gamco Global vs. Hennessy Bp Energy | Gamco Global vs. Gamco Natural Resources | Gamco Global vs. World Energy Fund |
| American Beacon vs. Rreef Property Trust | American Beacon vs. Nexpoint Real Estate | American Beacon vs. Short Real Estate | American Beacon vs. Vanguard Reit Index |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
Other Complementary Tools
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
| Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine |