Correlation Between GAMCO Global and Global E
Can any of the company-specific risk be diversified away by investing in both GAMCO Global and Global E 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 Global and Global E into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GAMCO Global Gold and Global E Online, you can compare the effects of market volatilities on GAMCO Global and Global E 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 Global with a short position of Global E. Check out your portfolio center. Please also check ongoing floating volatility patterns of GAMCO Global and Global E.
Diversification Opportunities for GAMCO Global and Global E
-0.36 | Correlation Coefficient |
Very good diversification
The 3 months correlation between GAMCO and Global is -0.36. Overlapping area represents the amount of risk that can be diversified away by holding GAMCO Global Gold and Global E Online in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Global E Online and GAMCO 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 GAMCO Global Gold are associated (or correlated) with Global E. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Global E Online has no effect on the direction of GAMCO Global i.e., GAMCO Global and Global E go up and down completely randomly.
Pair Corralation between GAMCO Global and Global E
Assuming the 90 days trading horizon GAMCO Global is expected to generate 8.04 times less return on investment than Global E. But when comparing it to its historical volatility, GAMCO Global Gold is 2.26 times less risky than Global E. It trades about 0.02 of its potential returns per unit of risk. Global E Online is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 2,283 in Global E Online on September 3, 2024 and sell it today you would earn a total of 2,945 from holding Global E Online or generate 129.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 94.75% |
| Values | Daily Returns |
GAMCO Global Gold vs. Global E Online
Performance |
| Timeline |
| GAMCO Global Gold |
| Global E Online |
GAMCO Global and Global E Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GAMCO Global and Global E
The main advantage of trading using opposite GAMCO Global and Global E positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GAMCO Global position performs unexpectedly, Global E 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 Global E will offset losses from the drop in Global E's long position.| GAMCO Global vs. Oxford Lane Capital | GAMCO Global vs. OFS Credit | GAMCO Global vs. XOMA Corporation | GAMCO Global vs. Oxford Lane Capital |
| Global E vs. MercadoLibre | Global E vs. PDD Holdings | Global E vs. JD Inc Adr | Global E vs. Alibaba Group Holding |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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