Correlation Between Lord Abbett and Gamco International
Can any of the company-specific risk be diversified away by investing in both Lord Abbett and Gamco International 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 Lord Abbett and Gamco International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lord Abbett Health and Gamco International Growth, you can compare the effects of market volatilities on Lord Abbett and Gamco International 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 Lord Abbett with a short position of Gamco International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lord Abbett and Gamco International.
Diversification Opportunities for Lord Abbett and Gamco International
0.36 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Lord and Gamco is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding Lord Abbett Health and Gamco International Growth in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gamco International and Lord Abbett 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 Lord Abbett Health are associated (or correlated) with Gamco International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gamco International has no effect on the direction of Lord Abbett i.e., Lord Abbett and Gamco International go up and down completely randomly.
Pair Corralation between Lord Abbett and Gamco International
Assuming the 90 days horizon Lord Abbett Health is expected to under-perform the Gamco International. In addition to that, Lord Abbett is 1.01 times more volatile than Gamco International Growth. It trades about -0.09 of its total potential returns per unit of risk. Gamco International Growth is currently generating about -0.06 per unit of volatility. If you would invest 2,306 in Gamco International Growth on January 12, 2025 and sell it today you would lose (84.00) from holding Gamco International Growth or give up 3.64% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Lord Abbett Health vs. Gamco International Growth
Performance |
| Timeline |
| Lord Abbett Health |
| Gamco International |
Lord Abbett and Gamco International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lord Abbett and Gamco International
The main advantage of trading using opposite Lord Abbett and Gamco International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lord Abbett position performs unexpectedly, Gamco International 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 International will offset losses from the drop in Gamco International's long position.| Lord Abbett vs. Artisan Select Equity | Lord Abbett vs. Pnc International Equity | Lord Abbett vs. Pace International Equity | Lord Abbett vs. Consumer Staples Portfolio |
| Gamco International vs. Gabelli Esg Fund | Gamco International vs. Gabelli Global Financial | Gamco International vs. The Gabelli Equity | Gamco International vs. Gamco International Growth |
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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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