Correlation Between California Bond and Gabelli Global
Can any of the company-specific risk be diversified away by investing in both California Bond and Gabelli Global 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 California Bond and Gabelli Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between California Bond Fund and Gabelli Global Financial, you can compare the effects of market volatilities on California Bond and Gabelli Global 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 California Bond with a short position of Gabelli Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of California Bond and Gabelli Global.
Diversification Opportunities for California Bond and Gabelli Global
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between California and Gabelli is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding California Bond Fund and Gabelli Global Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gabelli Global Financial and California Bond 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 California Bond Fund are associated (or correlated) with Gabelli Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gabelli Global Financial has no effect on the direction of California Bond i.e., California Bond and Gabelli Global go up and down completely randomly.
Pair Corralation between California Bond and Gabelli Global
Assuming the 90 days horizon California Bond Fund is expected to generate 0.47 times more return on investment than Gabelli Global. However, California Bond Fund is 2.12 times less risky than Gabelli Global. It trades about -0.2 of its potential returns per unit of risk. Gabelli Global Financial is currently generating about -0.22 per unit of risk. If you would invest 1,046 in California Bond Fund on October 13, 2024 and sell it today you would lose (14.00) from holding California Bond Fund or give up 1.34% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
California Bond Fund vs. Gabelli Global Financial
Performance |
| Timeline |
| California Bond |
| Gabelli Global Financial |
California Bond and Gabelli Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with California Bond and Gabelli Global
The main advantage of trading using opposite California Bond and Gabelli Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if California Bond position performs unexpectedly, Gabelli Global 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 Global will offset losses from the drop in Gabelli Global's long position.| California Bond vs. Dreyfus Technology Growth | California Bond vs. Columbia Global Technology | California Bond vs. Goldman Sachs Technology | California Bond vs. Towpath Technology |
| Gabelli Global vs. Old Westbury Fixed | Gabelli Global vs. California Bond Fund | Gabelli Global vs. Bbh Intermediate Municipal | Gabelli Global vs. Pace Strategic Fixed |
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 Stocks Directory module to find actively traded stocks across global markets.
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