Correlation Between Gamco Global and Amcap Fund
Can any of the company-specific risk be diversified away by investing in both Gamco Global and Amcap Fund 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 Gamco Global and Amcap Fund into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Gamco Global Gold and Amcap Fund Class, you can compare the effects of market volatilities on Gamco Global and Amcap Fund 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 Gamco Global with a short position of Amcap Fund. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gamco Global and Amcap Fund.
Diversification Opportunities for Gamco Global and Amcap Fund
0.52 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Gamco and Amcap is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding Gamco Global Gold and Amcap Fund Class in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amcap Fund Class and Gamco Global 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 Gamco Global Gold are associated (or correlated) with Amcap Fund. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amcap Fund Class has no effect on the direction of Gamco Global i.e., Gamco Global and Amcap Fund go up and down completely randomly.
Pair Corralation between Gamco Global and Amcap Fund
Assuming the 90 days horizon Gamco Global Gold is expected to generate 0.97 times more return on investment than Amcap Fund. However, Gamco Global Gold is 1.03 times less risky than Amcap Fund. It trades about 0.19 of its potential returns per unit of risk. Amcap Fund Class is currently generating about -0.12 per unit of risk. If you would invest 408.00 in Gamco Global Gold on November 28, 2024 and sell it today you would earn a total of 12.00 from holding Gamco Global Gold or generate 2.94% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Gamco Global Gold vs. Amcap Fund Class
Performance |
| Timeline |
| Gamco Global Gold |
| Amcap Fund Class |
Gamco Global and Amcap Fund Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gamco Global and Amcap Fund
The main advantage of trading using opposite Gamco Global and Amcap Fund positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gamco Global position performs unexpectedly, Amcap Fund 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 Amcap Fund will offset losses from the drop in Amcap Fund's long position.| Gamco Global vs. Goldman Sachs Financial | Gamco Global vs. Transamerica Financial Life | Gamco Global vs. Rmb Mendon Financial | Gamco Global vs. 1919 Financial Services |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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