Correlation Between Blackrock Muniholdings and GAMCO Natural
Can any of the company-specific risk be diversified away by investing in both Blackrock Muniholdings and GAMCO Natural 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 Blackrock Muniholdings and GAMCO Natural into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Blackrock Muniholdings Closed and GAMCO Natural Resources, you can compare the effects of market volatilities on Blackrock Muniholdings and GAMCO Natural 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 Blackrock Muniholdings with a short position of GAMCO Natural. Check out your portfolio center. Please also check ongoing floating volatility patterns of Blackrock Muniholdings and GAMCO Natural.
Diversification Opportunities for Blackrock Muniholdings and GAMCO Natural
0.45 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Blackrock and GAMCO is 0.45. Overlapping area represents the amount of risk that can be diversified away by holding Blackrock Muniholdings Closed and GAMCO Natural Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GAMCO Natural Resources and Blackrock Muniholdings 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 Blackrock Muniholdings Closed are associated (or correlated) with GAMCO Natural. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GAMCO Natural Resources has no effect on the direction of Blackrock Muniholdings i.e., Blackrock Muniholdings and GAMCO Natural go up and down completely randomly.
Pair Corralation between Blackrock Muniholdings and GAMCO Natural
Considering the 90-day investment horizon Blackrock Muniholdings Closed is expected to generate 0.65 times more return on investment than GAMCO Natural. However, Blackrock Muniholdings Closed is 1.53 times less risky than GAMCO Natural. It trades about 0.21 of its potential returns per unit of risk. GAMCO Natural Resources is currently generating about -0.03 per unit of risk. If you would invest 1,208 in Blackrock Muniholdings Closed on August 31, 2024 and sell it today you would earn a total of 37.00 from holding Blackrock Muniholdings Closed or generate 3.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Blackrock Muniholdings Closed vs. GAMCO Natural Resources
Performance |
| Timeline |
| Blackrock Muniholdings |
| GAMCO Natural Resources |
Blackrock Muniholdings and GAMCO Natural Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Blackrock Muniholdings and GAMCO Natural
The main advantage of trading using opposite Blackrock Muniholdings and GAMCO Natural positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Blackrock Muniholdings position performs unexpectedly, GAMCO Natural 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 Natural will offset losses from the drop in GAMCO Natural's long position.| Blackrock Muniholdings vs. John Hancock Income | Blackrock Muniholdings vs. MFS High Income | Blackrock Muniholdings vs. MFS Investment Grade | Blackrock Muniholdings vs. DTF Tax Free |
| GAMCO Natural vs. Blackrock Floating Rate | GAMCO Natural vs. Eaton Vance Senior | GAMCO Natural vs. Eaton Vance Senior | GAMCO Natural vs. Blackrock Debt Strategies |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
Other Complementary Tools
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. | |
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio |