Correlation Between Gabelli Global and Mesirow Financial
Can any of the company-specific risk be diversified away by investing in both Gabelli Global and Mesirow Financial 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 Mesirow Financial 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 Mesirow Financial Small, you can compare the effects of market volatilities on Gabelli Global and Mesirow Financial 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 Mesirow Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gabelli Global and Mesirow Financial.
Diversification Opportunities for Gabelli Global and Mesirow Financial
0.89 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Gabelli and MESIROW is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding Gabelli Global Financial and Mesirow Financial Small in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mesirow Financial Small 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 Mesirow Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mesirow Financial Small has no effect on the direction of Gabelli Global i.e., Gabelli Global and Mesirow Financial go up and down completely randomly.
Pair Corralation between Gabelli Global and Mesirow Financial
Assuming the 90 days horizon Gabelli Global is expected to generate 1.0 times less return on investment than Mesirow Financial. But when comparing it to its historical volatility, Gabelli Global Financial is 1.12 times less risky than Mesirow Financial. It trades about 0.15 of its potential returns per unit of risk. Mesirow Financial Small is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest 1,324 in Mesirow Financial Small on September 2, 2024 and sell it today you would earn a total of 120.00 from holding Mesirow Financial Small or generate 9.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Gabelli Global Financial vs. Mesirow Financial Small
Performance |
| Timeline |
| Gabelli Global Financial |
| Mesirow Financial Small |
Gabelli Global and Mesirow Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gabelli Global and Mesirow Financial
The main advantage of trading using opposite Gabelli Global and Mesirow Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gabelli Global position performs unexpectedly, Mesirow Financial 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 Mesirow Financial will offset losses from the drop in Mesirow Financial's long position.| Gabelli Global vs. Gabelli Esg Fund | Gabelli Global vs. The Gabelli Equity | Gabelli Global vs. Gamco International Growth | Gabelli Global vs. Enterprise Mergers And |
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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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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