Correlation Between Gamco International and The Gabelli
Can any of the company-specific risk be diversified away by investing in both Gamco International and The Gabelli 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 International and The Gabelli into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Gamco International Growth and The Gabelli Equity, you can compare the effects of market volatilities on Gamco International and The Gabelli 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 International with a short position of The Gabelli. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gamco International and The Gabelli.
Diversification Opportunities for Gamco International and The Gabelli
-0.37 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Gamco and The is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding Gamco International Growth and The Gabelli Equity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gabelli Equity and Gamco International 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 International Growth are associated (or correlated) with The Gabelli. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gabelli Equity has no effect on the direction of Gamco International i.e., Gamco International and The Gabelli go up and down completely randomly.
Pair Corralation between Gamco International and The Gabelli
Assuming the 90 days horizon Gamco International Growth is expected to under-perform the The Gabelli. But the mutual fund apears to be less risky and, when comparing its historical volatility, Gamco International Growth is 1.11 times less risky than The Gabelli. The mutual fund trades about -0.33 of its potential returns per unit of risk. The The Gabelli Equity is currently generating about 0.22 of returns per unit of risk over similar time horizon. If you would invest 638.00 in The Gabelli Equity on August 26, 2024 and sell it today you would earn a total of 28.00 from holding The Gabelli Equity or generate 4.39% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Gamco International Growth vs. The Gabelli Equity
Performance |
| Timeline |
| Gamco International |
| Gabelli Equity |
Gamco International and The Gabelli Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gamco International and The Gabelli
The main advantage of trading using opposite Gamco International and The Gabelli positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gamco International position performs unexpectedly, The Gabelli 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 The Gabelli will offset losses from the drop in The Gabelli's long position.| Gamco International vs. Gamco Global Opportunity | Gamco International vs. Gamco Global Growth | Gamco International vs. Gamco Global Telecommunications | Gamco International vs. The Gabelli Growth |
| The Gabelli vs. The Gabelli Small | The Gabelli vs. The Gabelli Asset | The Gabelli vs. Wasatch Large Cap | The Gabelli vs. Tcw Relative Value |
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 CEOs Directory module to screen CEOs from public companies around the world.
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