Correlation Between Gamco Investors and Wendys
Can any of the company-specific risk be diversified away by investing in both Gamco Investors and Wendys 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 Investors and Wendys into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Gamco Investors and The Wendys Co, you can compare the effects of market volatilities on Gamco Investors and Wendys 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 Investors with a short position of Wendys. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gamco Investors and Wendys.
Diversification Opportunities for Gamco Investors and Wendys
0.1 | Correlation Coefficient |
Average diversification
The 3 months correlation between Gamco and Wendys is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding Gamco Investors and The Wendys Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on The Wendys and Gamco Investors 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 Investors are associated (or correlated) with Wendys. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of The Wendys has no effect on the direction of Gamco Investors i.e., Gamco Investors and Wendys go up and down completely randomly.
Pair Corralation between Gamco Investors and Wendys
If you would invest 1,600 in Gamco Investors on September 12, 2024 and sell it today you would earn a total of 0.00 from holding Gamco Investors or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 0.4% |
| Values | Daily Returns |
Gamco Investors vs. The Wendys Co
Performance |
| Timeline |
| Gamco Investors |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| The Wendys |
Gamco Investors and Wendys Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gamco Investors and Wendys
The main advantage of trading using opposite Gamco Investors and Wendys positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gamco Investors position performs unexpectedly, Wendys 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 Wendys will offset losses from the drop in Wendys' long position.| Gamco Investors vs. Mannatech Incorporated | Gamco Investors vs. Weyco Group | Gamco Investors vs. Ecoloclean Industrs | Gamco Investors vs. Apogee Therapeutics, Common |
| Wendys vs. Yum Brands | Wendys vs. Dominos Pizza | Wendys vs. Darden Restaurants | Wendys vs. Papa Johns International |
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 Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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