Correlation Between Gabelli Convertible and Franklin Dynatech
Can any of the company-specific risk be diversified away by investing in both Gabelli Convertible and Franklin Dynatech 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 Franklin Dynatech 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 Franklin Dynatech Fund, you can compare the effects of market volatilities on Gabelli Convertible and Franklin Dynatech 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 Franklin Dynatech. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gabelli Convertible and Franklin Dynatech.
Diversification Opportunities for Gabelli Convertible and Franklin Dynatech
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Gabelli and Franklin is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding Gabelli Convertible And and Franklin Dynatech Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Franklin Dynatech 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 Franklin Dynatech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Franklin Dynatech has no effect on the direction of Gabelli Convertible i.e., Gabelli Convertible and Franklin Dynatech go up and down completely randomly.
Pair Corralation between Gabelli Convertible and Franklin Dynatech
Considering the 90-day investment horizon Gabelli Convertible is expected to generate 15.65 times less return on investment than Franklin Dynatech. But when comparing it to its historical volatility, Gabelli Convertible And is 1.12 times less risky than Franklin Dynatech. It trades about 0.01 of its potential returns per unit of risk. Franklin Dynatech Fund is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 7,347 in Franklin Dynatech Fund on September 14, 2024 and sell it today you would earn a total of 7,024 from holding Franklin Dynatech Fund or generate 95.6% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.8% |
| Values | Daily Returns |
Gabelli Convertible And vs. Franklin Dynatech Fund
Performance |
| Timeline |
| Gabelli Convertible And |
| Franklin Dynatech |
Gabelli Convertible and Franklin Dynatech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gabelli Convertible and Franklin Dynatech
The main advantage of trading using opposite Gabelli Convertible and Franklin Dynatech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gabelli Convertible position performs unexpectedly, Franklin Dynatech 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 Franklin Dynatech will offset losses from the drop in Franklin Dynatech'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 |
| Franklin Dynatech vs. Ashmore Emerging Markets | Franklin Dynatech vs. Calvert Emerging Markets | Franklin Dynatech vs. Rbc Emerging Markets | Franklin Dynatech vs. Siit Emerging Markets |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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