Correlation Between Aberdeen Global and Gabelli Dividend

Can any of the company-specific risk be diversified away by investing in both Aberdeen Global and Gabelli Dividend 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 Aberdeen Global and Gabelli Dividend into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Aberdeen Global Dynamic and Gabelli Dividend Income, you can compare the effects of market volatilities on Aberdeen Global and Gabelli Dividend 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 Aberdeen Global with a short position of Gabelli Dividend. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aberdeen Global and Gabelli Dividend.

Diversification Opportunities for Aberdeen Global and Gabelli Dividend

0.24

Correlation Coefficient

Aberdeen Global  Gabelli Dividend

Modest diversification

The 3 months correlation between Aberdeen and Gabelli is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding Aberdeen Global Dynamic and Gabelli Dividend Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gabelli Dividend Income and Aberdeen 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 Aberdeen Global Dynamic are associated (or correlated) with Gabelli Dividend. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gabelli Dividend Income has no effect on the direction of Aberdeen Global i.e., Aberdeen Global and Gabelli Dividend go up and down completely randomly.

Pair Corralation between Aberdeen Global and Gabelli Dividend

Considering the 90-day investment horizon Aberdeen Global Dynamic is expected to generate 0.81 times more return on investment than Gabelli Dividend. However, Aberdeen Global Dynamic is 1.23 times less risky than Gabelli Dividend. It trades about -0.2 of its potential returns per unit of risk. Gabelli Dividend Income is currently generating about -0.22 per unit of risk. If you would invest  1,016  in Aberdeen Global Dynamic on September 24, 2024 and sell it today you would lose (29.00) from holding Aberdeen Global Dynamic or give up 2.85% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Aberdeen Global Dynamic  vs.  Gabelli Dividend Income

Aberdeen Global Dynamic

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Aberdeen Global Dynamic has generated negative risk-adjusted returns adding no value to fund investors. In spite of rather sound technical and fundamental indicators, Aberdeen Global is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.

Gabelli Dividend Income

Risk-Adjusted Performance

1 of 100

Very Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Gabelli Dividend Income are ranked lower than 1 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly stable fundamental indicators, Gabelli Dividend is not utilizing all of its potentials. The newest stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Pair Trading with Aberdeen Global and Gabelli Dividend

The main advantage of trading using opposite Aberdeen Global and Gabelli Dividend positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aberdeen Global position performs unexpectedly, Gabelli Dividend 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 Dividend will offset losses from the drop in Gabelli Dividend's long position.

The idea behind Aberdeen Global Dynamic and Gabelli Dividend Income pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.