Correlation Between Gabelli Convertible and European Equity
Can any of the company-specific risk be diversified away by investing in both Gabelli Convertible and European Equity 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 Convertible and European Equity into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Gabelli Convertible And and European Equity Closed, you can compare the effects of market volatilities on Gabelli Convertible and European Equity 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 Convertible with a short position of European Equity. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gabelli Convertible and European Equity.
Diversification Opportunities for Gabelli Convertible and European Equity
-0.32 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Gabelli and European is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding Gabelli Convertible And and European Equity Closed in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on European Equity Closed and Gabelli Convertible 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 Convertible And are associated (or correlated) with European Equity. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of European Equity Closed has no effect on the direction of Gabelli Convertible i.e., Gabelli Convertible and European Equity go up and down completely randomly.
Pair Corralation between Gabelli Convertible and European Equity
Considering the 90-day investment horizon Gabelli Convertible is expected to generate 3.78 times less return on investment than European Equity. In addition to that, Gabelli Convertible is 1.49 times more volatile than European Equity Closed. It trades about 0.08 of its total potential returns per unit of risk. European Equity Closed is currently generating about 0.43 per unit of volatility. If you would invest 814.00 in European Equity Closed on November 1, 2024 and sell it today you would earn a total of 53.00 from holding European Equity Closed or generate 6.51% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Gabelli Convertible And vs. European Equity Closed
Performance |
| Timeline |
| Gabelli Convertible And |
| European Equity Closed |
Gabelli Convertible and European Equity Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gabelli Convertible and European Equity
The main advantage of trading using opposite Gabelli Convertible and European Equity positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gabelli Convertible position performs unexpectedly, European Equity 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 European Equity will offset losses from the drop in European Equity's long position.| Gabelli Convertible vs. Gabelli Global Small | Gabelli Convertible vs. MFS Investment Grade | Gabelli Convertible vs. Eaton Vance National | Gabelli Convertible vs. GAMCO Natural Resources |
| European Equity vs. XAI Octagon Floating | European Equity vs. MFS Charter Income | European Equity vs. Nuveen New York | European Equity vs. Western Asset High |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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