Correlation Between Icon Natural and Gamco Global
Can any of the company-specific risk be diversified away by investing in both Icon Natural and Gamco Global 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 Icon Natural and Gamco Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Icon Natural Resources and Gamco Global Gold, you can compare the effects of market volatilities on Icon Natural and Gamco Global 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 Icon Natural with a short position of Gamco Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Icon Natural and Gamco Global.
Diversification Opportunities for Icon Natural and Gamco Global
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Icon and Gamco is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Icon Natural Resources and Gamco Global Gold in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gamco Global Gold and Icon 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 Icon Natural Resources are associated (or correlated) with Gamco Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gamco Global Gold has no effect on the direction of Icon Natural i.e., Icon Natural and Gamco Global go up and down completely randomly.
Pair Corralation between Icon Natural and Gamco Global
Assuming the 90 days horizon Icon Natural Resources is expected to under-perform the Gamco Global. In addition to that, Icon Natural is 1.51 times more volatile than Gamco Global Gold. It trades about -0.01 of its total potential returns per unit of risk. Gamco Global Gold is currently generating about 0.01 per unit of volatility. If you would invest 411.00 in Gamco Global Gold on October 25, 2024 and sell it today you would earn a total of 1.00 from holding Gamco Global Gold or generate 0.24% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Icon Natural Resources vs. Gamco Global Gold
Performance |
| Timeline |
| Icon Natural Resources |
| Gamco Global Gold |
Icon Natural and Gamco Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Icon Natural and Gamco Global
The main advantage of trading using opposite Icon Natural and Gamco Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Icon Natural position performs unexpectedly, Gamco Global 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 Gamco Global will offset losses from the drop in Gamco Global's long position.| Icon Natural vs. Vanguard Materials Index | Icon Natural vs. T Rowe Price | Icon Natural vs. Gmo Resources | Icon Natural vs. HUMANA INC |
| Gamco Global vs. Tekla Healthcare Investors | Gamco Global vs. Blackrock Health Sciences | Gamco Global vs. Baron Health Care | Gamco Global vs. Allianzgi Health Sciences |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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