Correlation Between Special Opportunities and Gabelli Utility
Can any of the company-specific risk be diversified away by investing in both Special Opportunities and Gabelli Utility 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 Special Opportunities and Gabelli Utility into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Special Opportunities Closed and Gabelli Utility Closed, you can compare the effects of market volatilities on Special Opportunities and Gabelli Utility 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 Special Opportunities with a short position of Gabelli Utility. Check out your portfolio center. Please also check ongoing floating volatility patterns of Special Opportunities and Gabelli Utility.
Diversification Opportunities for Special Opportunities and Gabelli Utility
0.57 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Special and Gabelli is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding Special Opportunities Closed and Gabelli Utility Closed in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gabelli Utility Closed and Special Opportunities 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 Special Opportunities Closed are associated (or correlated) with Gabelli Utility. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gabelli Utility Closed has no effect on the direction of Special Opportunities i.e., Special Opportunities and Gabelli Utility go up and down completely randomly.
Pair Corralation between Special Opportunities and Gabelli Utility
Considering the 90-day investment horizon Special Opportunities Closed is expected to generate 0.66 times more return on investment than Gabelli Utility. However, Special Opportunities Closed is 1.5 times less risky than Gabelli Utility. It trades about 0.37 of its potential returns per unit of risk. Gabelli Utility Closed is currently generating about 0.18 per unit of risk. If you would invest 1,489 in Special Opportunities Closed on November 9, 2024 and sell it today you would earn a total of 71.00 from holding Special Opportunities Closed or generate 4.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Special Opportunities Closed vs. Gabelli Utility Closed
Performance |
| Timeline |
| Special Opportunities |
| Gabelli Utility Closed |
Special Opportunities and Gabelli Utility Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Special Opportunities and Gabelli Utility
The main advantage of trading using opposite Special Opportunities and Gabelli Utility positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Special Opportunities position performs unexpectedly, Gabelli Utility 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 Utility will offset losses from the drop in Gabelli Utility's long position.| Special Opportunities vs. Ares Dynamic Credit | Special Opportunities vs. Lazard Global Total | Special Opportunities vs. Principal Real Estate | Special Opportunities vs. Tortoise Capital Series |
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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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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