Correlation Between Needham Aggressive and Gabelli Media
Can any of the company-specific risk be diversified away by investing in both Needham Aggressive and Gabelli Media 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 Needham Aggressive and Gabelli Media into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Needham Aggressive Growth and Gabelli Media Mogul, you can compare the effects of market volatilities on Needham Aggressive and Gabelli Media 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 Needham Aggressive with a short position of Gabelli Media. Check out your portfolio center. Please also check ongoing floating volatility patterns of Needham Aggressive and Gabelli Media.
Diversification Opportunities for Needham Aggressive and Gabelli Media
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Needham and Gabelli is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding Needham Aggressive Growth and Gabelli Media Mogul in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gabelli Media Mogul and Needham Aggressive 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 Needham Aggressive Growth are associated (or correlated) with Gabelli Media. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gabelli Media Mogul has no effect on the direction of Needham Aggressive i.e., Needham Aggressive and Gabelli Media go up and down completely randomly.
Pair Corralation between Needham Aggressive and Gabelli Media
Assuming the 90 days horizon Needham Aggressive Growth is expected to generate 1.45 times more return on investment than Gabelli Media. However, Needham Aggressive is 1.45 times more volatile than Gabelli Media Mogul. It trades about 0.06 of its potential returns per unit of risk. Gabelli Media Mogul is currently generating about 0.03 per unit of risk. If you would invest 4,222 in Needham Aggressive Growth on September 14, 2024 and sell it today you would earn a total of 958.00 from holding Needham Aggressive Growth or generate 22.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Needham Aggressive Growth vs. Gabelli Media Mogul
Performance |
| Timeline |
| Needham Aggressive Growth |
| Gabelli Media Mogul |
Needham Aggressive and Gabelli Media Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Needham Aggressive and Gabelli Media
The main advantage of trading using opposite Needham Aggressive and Gabelli Media positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Needham Aggressive position performs unexpectedly, Gabelli Media 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 Gabelli Media will offset losses from the drop in Gabelli Media's long position.| Needham Aggressive vs. Needham Aggressive Growth | Needham Aggressive vs. Needham Small Cap | Needham Aggressive vs. Ultramid Cap Profund Ultramid Cap | Needham Aggressive vs. Fidelity Advisor Semiconductors |
| Gabelli Media vs. Alphacentric Lifesci Healthcare | Gabelli Media vs. Hartford Healthcare Hls | Gabelli Media vs. Vanguard Health Care | Gabelli Media vs. Live Oak Health |
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 Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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