Correlation Between Gladstone Capital and Eaton Vance
Can any of the company-specific risk be diversified away by investing in both Gladstone Capital and Eaton Vance 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 Gladstone Capital and Eaton Vance into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Gladstone Capital and Eaton Vance Tax, you can compare the effects of market volatilities on Gladstone Capital and Eaton Vance 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 Gladstone Capital with a short position of Eaton Vance. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gladstone Capital and Eaton Vance.
Diversification Opportunities for Gladstone Capital and Eaton Vance
0.52 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Gladstone and Eaton is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding Gladstone Capital and Eaton Vance Tax in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eaton Vance Tax and Gladstone Capital 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 Gladstone Capital are associated (or correlated) with Eaton Vance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eaton Vance Tax has no effect on the direction of Gladstone Capital i.e., Gladstone Capital and Eaton Vance go up and down completely randomly.
Pair Corralation between Gladstone Capital and Eaton Vance
Given the investment horizon of 90 days Gladstone Capital is expected to generate 1.26 times more return on investment than Eaton Vance. However, Gladstone Capital is 1.26 times more volatile than Eaton Vance Tax. It trades about 0.1 of its potential returns per unit of risk. Eaton Vance Tax is currently generating about 0.08 per unit of risk. If you would invest 1,703 in Gladstone Capital on September 3, 2024 and sell it today you would earn a total of 1,086 from holding Gladstone Capital or generate 63.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Gladstone Capital vs. Eaton Vance Tax
Performance |
| Timeline |
| Gladstone Capital |
| Eaton Vance Tax |
Gladstone Capital and Eaton Vance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gladstone Capital and Eaton Vance
The main advantage of trading using opposite Gladstone Capital and Eaton Vance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gladstone Capital position performs unexpectedly, Eaton Vance 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 Eaton Vance will offset losses from the drop in Eaton Vance's long position.| Gladstone Capital vs. Main Street Capital | Gladstone Capital vs. PennantPark Floating Rate | Gladstone Capital vs. Horizon Technology Finance | Gladstone Capital vs. Prospect Capital |
| Eaton Vance vs. Eaton Vance Tax | Eaton Vance vs. Eaton Vance Risk | Eaton Vance vs. Eaton Vance Tax | Eaton Vance vs. Eaton Vance Tax |
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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