Correlation Between Gabelli Global and Kansas Municipal
Can any of the company-specific risk be diversified away by investing in both Gabelli Global and Kansas Municipal 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 Global and Kansas Municipal into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Gabelli Global Financial and Kansas Municipal Fund, you can compare the effects of market volatilities on Gabelli Global and Kansas Municipal 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 Global with a short position of Kansas Municipal. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gabelli Global and Kansas Municipal.
Diversification Opportunities for Gabelli Global and Kansas Municipal
-0.6 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Gabelli and Kansas is -0.6. Overlapping area represents the amount of risk that can be diversified away by holding Gabelli Global Financial and Kansas Municipal Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kansas Municipal and Gabelli 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 Gabelli Global Financial are associated (or correlated) with Kansas Municipal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kansas Municipal has no effect on the direction of Gabelli Global i.e., Gabelli Global and Kansas Municipal go up and down completely randomly.
Pair Corralation between Gabelli Global and Kansas Municipal
Assuming the 90 days horizon Gabelli Global Financial is expected to generate 2.89 times more return on investment than Kansas Municipal. However, Gabelli Global is 2.89 times more volatile than Kansas Municipal Fund. It trades about 0.27 of its potential returns per unit of risk. Kansas Municipal Fund is currently generating about 0.13 per unit of risk. If you would invest 1,554 in Gabelli Global Financial on August 25, 2024 and sell it today you would earn a total of 92.00 from holding Gabelli Global Financial or generate 5.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Gabelli Global Financial vs. Kansas Municipal Fund
Performance |
| Timeline |
| Gabelli Global Financial |
| Kansas Municipal |
Gabelli Global and Kansas Municipal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gabelli Global and Kansas Municipal
The main advantage of trading using opposite Gabelli Global and Kansas Municipal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gabelli Global position performs unexpectedly, Kansas Municipal 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 Kansas Municipal will offset losses from the drop in Kansas Municipal's long position.| Gabelli Global vs. Health Care Fund | Gabelli Global vs. Banking Fund Investor | Gabelli Global vs. Technology Fund Investor | Gabelli Global vs. Transportation Fund Investor |
| Kansas Municipal vs. Icon Financial Fund | Kansas Municipal vs. Gabelli Global Financial | Kansas Municipal vs. Prudential Jennison Financial | Kansas Municipal vs. Fidelity Advisor Financial |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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