Correlation Between Gamco Natural and Aim International
Can any of the company-specific risk be diversified away by investing in both Gamco Natural and Aim International 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 Natural and Aim International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Gamco Natural Resources and Aim International Mutual, you can compare the effects of market volatilities on Gamco Natural and Aim International 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 Natural with a short position of Aim International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gamco Natural and Aim International.
Diversification Opportunities for Gamco Natural and Aim International
0.38 | Correlation Coefficient |
Weak diversification
The 3 months correlation between GAMCO and Aim is 0.38. Overlapping area represents the amount of risk that can be diversified away by holding Gamco Natural Resources and Aim International Mutual in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aim International Mutual and Gamco Natural 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 Natural Resources are associated (or correlated) with Aim International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aim International Mutual has no effect on the direction of Gamco Natural i.e., Gamco Natural and Aim International go up and down completely randomly.
Pair Corralation between Gamco Natural and Aim International
Assuming the 90 days horizon Gamco Natural Resources is expected to generate 1.02 times more return on investment than Aim International. However, Gamco Natural is 1.02 times more volatile than Aim International Mutual. It trades about -0.12 of its potential returns per unit of risk. Aim International Mutual is currently generating about -0.19 per unit of risk. If you would invest 662.00 in Gamco Natural Resources on August 27, 2024 and sell it today you would lose (13.00) from holding Gamco Natural Resources or give up 1.96% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Gamco Natural Resources vs. Aim International Mutual
Performance |
| Timeline |
| Gamco Natural Resources |
| Aim International Mutual |
Gamco Natural and Aim International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gamco Natural and Aim International
The main advantage of trading using opposite Gamco Natural and Aim International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gamco Natural position performs unexpectedly, Aim International 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 Aim International will offset losses from the drop in Aim International's long position.| Gamco Natural vs. Prudential Real Estate | Gamco Natural vs. Vy Clarion Real | Gamco Natural vs. Pender Real Estate | Gamco Natural vs. Virtus Real Estate |
| Aim International vs. Auer Growth Fund | Aim International vs. Rational Special Situations | Aim International vs. Ab Value Fund | Aim International vs. Eic Value Fund |
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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