Correlation Between Gabelli Gold and Sterling Capital
Can any of the company-specific risk be diversified away by investing in both Gabelli Gold and Sterling Capital 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 Gold and Sterling Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Gabelli Gold Fund and Sterling Capital Behavioral, you can compare the effects of market volatilities on Gabelli Gold and Sterling Capital 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 Gold with a short position of Sterling Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gabelli Gold and Sterling Capital.
Diversification Opportunities for Gabelli Gold and Sterling Capital
0.06 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Gabelli and Sterling is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding Gabelli Gold Fund and Sterling Capital Behavioral in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sterling Capital Beh and Gabelli Gold 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 Gold Fund are associated (or correlated) with Sterling Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sterling Capital Beh has no effect on the direction of Gabelli Gold i.e., Gabelli Gold and Sterling Capital go up and down completely randomly.
Pair Corralation between Gabelli Gold and Sterling Capital
Assuming the 90 days horizon Gabelli Gold Fund is expected to generate 2.04 times more return on investment than Sterling Capital. However, Gabelli Gold is 2.04 times more volatile than Sterling Capital Behavioral. It trades about 0.04 of its potential returns per unit of risk. Sterling Capital Behavioral is currently generating about 0.09 per unit of risk. If you would invest 1,680 in Gabelli Gold Fund on September 4, 2024 and sell it today you would earn a total of 551.00 from holding Gabelli Gold Fund or generate 32.8% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 99.8% |
| Values | Daily Returns |
Gabelli Gold Fund vs. Sterling Capital Behavioral
Performance |
| Timeline |
| Gabelli Gold |
| Sterling Capital Beh |
Gabelli Gold and Sterling Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gabelli Gold and Sterling Capital
The main advantage of trading using opposite Gabelli Gold and Sterling Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gabelli Gold position performs unexpectedly, Sterling Capital 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 Sterling Capital will offset losses from the drop in Sterling Capital's long position.| Gabelli Gold vs. Gabelli Esg Fund | Gabelli Gold vs. Gabelli Global Financial | Gabelli Gold vs. The Gabelli Equity | Gabelli Gold vs. Gamco International Growth |
| Sterling Capital vs. Federated Pennsylvania Municipal | Sterling Capital vs. Gmo High Yield | Sterling Capital vs. Dreyfusstandish Global Fixed | Sterling Capital vs. Artisan High Income |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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