Correlation Between GAMCO Natural and Nuveen Credit
Can any of the company-specific risk be diversified away by investing in both GAMCO Natural and Nuveen Credit 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 Nuveen Credit 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 Nuveen Credit Strategies, you can compare the effects of market volatilities on GAMCO Natural and Nuveen Credit 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 Nuveen Credit. Check out your portfolio center. Please also check ongoing floating volatility patterns of GAMCO Natural and Nuveen Credit.
Diversification Opportunities for GAMCO Natural and Nuveen Credit
-0.22 | Correlation Coefficient |
Very good diversification
The 3 months correlation between GAMCO and Nuveen is -0.22. Overlapping area represents the amount of risk that can be diversified away by holding GAMCO Natural Resources and Nuveen Credit Strategies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nuveen Credit Strategies 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 Nuveen Credit. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nuveen Credit Strategies has no effect on the direction of GAMCO Natural i.e., GAMCO Natural and Nuveen Credit go up and down completely randomly.
Pair Corralation between GAMCO Natural and Nuveen Credit
Considering the 90-day investment horizon GAMCO Natural is expected to generate 1.25 times less return on investment than Nuveen Credit. In addition to that, GAMCO Natural is 1.68 times more volatile than Nuveen Credit Strategies. It trades about 0.05 of its total potential returns per unit of risk. Nuveen Credit Strategies is currently generating about 0.1 per unit of volatility. If you would invest 421.00 in Nuveen Credit Strategies on August 31, 2024 and sell it today you would earn a total of 159.00 from holding Nuveen Credit Strategies or generate 37.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
GAMCO Natural Resources vs. Nuveen Credit Strategies
Performance |
| Timeline |
| GAMCO Natural Resources |
| Nuveen Credit Strategies |
GAMCO Natural and Nuveen Credit Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GAMCO Natural and Nuveen Credit
The main advantage of trading using opposite GAMCO Natural and Nuveen Credit positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GAMCO Natural position performs unexpectedly, Nuveen Credit 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 Nuveen Credit will offset losses from the drop in Nuveen Credit's long position.| GAMCO Natural vs. Blackrock Floating Rate | GAMCO Natural vs. Eaton Vance Senior | GAMCO Natural vs. Eaton Vance Senior | GAMCO Natural vs. Blackrock Debt Strategies |
| Nuveen Credit vs. MFS Investment Grade | Nuveen Credit vs. Eaton Vance Municipal | Nuveen Credit vs. DTF Tax Free | Nuveen Credit vs. HUMANA INC |
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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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