Correlation Between Gabelli Multimedia and Oxford Lane
Can any of the company-specific risk be diversified away by investing in both Gabelli Multimedia and Oxford Lane 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 Multimedia and Oxford Lane into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between The Gabelli Multimedia and Oxford Lane Capital, you can compare the effects of market volatilities on Gabelli Multimedia and Oxford Lane 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 Multimedia with a short position of Oxford Lane. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gabelli Multimedia and Oxford Lane.
Diversification Opportunities for Gabelli Multimedia and Oxford Lane
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Gabelli and Oxford is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding The Gabelli Multimedia and Oxford Lane Capital in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Oxford Lane Capital and Gabelli Multimedia 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 The Gabelli Multimedia are associated (or correlated) with Oxford Lane. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Oxford Lane Capital has no effect on the direction of Gabelli Multimedia i.e., Gabelli Multimedia and Oxford Lane go up and down completely randomly.
Pair Corralation between Gabelli Multimedia and Oxford Lane
Assuming the 90 days trading horizon The Gabelli Multimedia is expected to under-perform the Oxford Lane. In addition to that, Gabelli Multimedia is 1.06 times more volatile than Oxford Lane Capital. It trades about -0.21 of its total potential returns per unit of risk. Oxford Lane Capital is currently generating about -0.09 per unit of volatility. If you would invest 2,410 in Oxford Lane Capital on August 28, 2024 and sell it today you would lose (24.00) from holding Oxford Lane Capital or give up 1.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
The Gabelli Multimedia vs. Oxford Lane Capital
Performance |
| Timeline |
| The Gabelli Multimedia |
| Oxford Lane Capital |
Gabelli Multimedia and Oxford Lane Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gabelli Multimedia and Oxford Lane
The main advantage of trading using opposite Gabelli Multimedia and Oxford Lane positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gabelli Multimedia position performs unexpectedly, Oxford Lane 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 Oxford Lane will offset losses from the drop in Oxford Lane's long position.| Gabelli Multimedia vs. Virtus AllianzGI Convertible | Gabelli Multimedia vs. The Gabelli Equity | Gabelli Multimedia vs. Oxford Lane Capital | Gabelli Multimedia vs. The Gabelli Utility |
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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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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