Correlation Between GAMCO Natural and Advent Claymore
Can any of the company-specific risk be diversified away by investing in both GAMCO Natural and Advent Claymore 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 Natural and Advent Claymore into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GAMCO Natural Resources and Advent Claymore Convertible, you can compare the effects of market volatilities on GAMCO Natural and Advent Claymore 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 Natural with a short position of Advent Claymore. Check out your portfolio center. Please also check ongoing floating volatility patterns of GAMCO Natural and Advent Claymore.
Diversification Opportunities for GAMCO Natural and Advent Claymore
0.8 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between GAMCO and Advent is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding GAMCO Natural Resources and Advent Claymore Convertible in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Advent Claymore Conv and GAMCO Natural 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 Natural Resources are associated (or correlated) with Advent Claymore. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Advent Claymore Conv has no effect on the direction of GAMCO Natural i.e., GAMCO Natural and Advent Claymore go up and down completely randomly.
Pair Corralation between GAMCO Natural and Advent Claymore
Considering the 90-day investment horizon GAMCO Natural Resources is expected to generate 1.49 times more return on investment than Advent Claymore. However, GAMCO Natural is 1.49 times more volatile than Advent Claymore Convertible. It trades about 0.15 of its potential returns per unit of risk. Advent Claymore Convertible is currently generating about -0.03 per unit of risk. If you would invest 567.00 in GAMCO Natural Resources on November 27, 2024 and sell it today you would earn a total of 12.36 from holding GAMCO Natural Resources or generate 2.18% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 95.24% |
| Values | Daily Returns |
GAMCO Natural Resources vs. Advent Claymore Convertible
Performance |
| Timeline |
| GAMCO Natural Resources |
| Advent Claymore Conv |
GAMCO Natural and Advent Claymore Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GAMCO Natural and Advent Claymore
The main advantage of trading using opposite GAMCO Natural and Advent Claymore positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GAMCO Natural position performs unexpectedly, Advent Claymore 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 Advent Claymore will offset losses from the drop in Advent Claymore's long position.| GAMCO Natural vs. MFS Investment Grade | GAMCO Natural vs. Eaton Vance National | GAMCO Natural vs. Federated Premier Municipal | GAMCO Natural vs. Gabelli Healthcare WellnessRx |
| Advent Claymore vs. Nuveen Global High | Advent Claymore vs. Blackstone Gso Strategic | Advent Claymore vs. Thornburg Income Builder | Advent Claymore vs. Western Asset Diversified |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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