Correlation Between Old Westbury and Gabelli Utilities
Can any of the company-specific risk be diversified away by investing in both Old Westbury and Gabelli Utilities 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 Old Westbury and Gabelli Utilities into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Old Westbury Large and The Gabelli Utilities, you can compare the effects of market volatilities on Old Westbury and Gabelli Utilities 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 Old Westbury with a short position of Gabelli Utilities. Check out your portfolio center. Please also check ongoing floating volatility patterns of Old Westbury and Gabelli Utilities.
Diversification Opportunities for Old Westbury and Gabelli Utilities
0.31 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Old and Gabelli is 0.31. Overlapping area represents the amount of risk that can be diversified away by holding Old Westbury Large and The Gabelli Utilities in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gabelli Utilities and Old Westbury 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 Old Westbury Large are associated (or correlated) with Gabelli Utilities. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gabelli Utilities has no effect on the direction of Old Westbury i.e., Old Westbury and Gabelli Utilities go up and down completely randomly.
Pair Corralation between Old Westbury and Gabelli Utilities
Assuming the 90 days horizon Old Westbury Large is expected to generate 0.84 times more return on investment than Gabelli Utilities. However, Old Westbury Large is 1.2 times less risky than Gabelli Utilities. It trades about 0.11 of its potential returns per unit of risk. The Gabelli Utilities is currently generating about 0.01 per unit of risk. If you would invest 1,442 in Old Westbury Large on September 12, 2024 and sell it today you would earn a total of 720.00 from holding Old Westbury Large or generate 49.93% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 99.8% |
| Values | Daily Returns |
Old Westbury Large vs. The Gabelli Utilities
Performance |
| Timeline |
| Old Westbury Large |
| Gabelli Utilities |
Old Westbury and Gabelli Utilities Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Old Westbury and Gabelli Utilities
The main advantage of trading using opposite Old Westbury and Gabelli Utilities positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Old Westbury position performs unexpectedly, Gabelli Utilities 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 Utilities will offset losses from the drop in Gabelli Utilities' long position.| Old Westbury vs. Lord Abbett Government | Old Westbury vs. Us Government Securities | Old Westbury vs. Dreyfus Government Cash | Old Westbury vs. Goldman Sachs Government |
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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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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