Correlation Between CBH and Gabelli Equity

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

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

Diversification Opportunities for CBH and Gabelli Equity

0.0

Correlation Coefficient

CBH  Gabelli Equity

Pay attention - limited upside

The 3 months correlation between CBH and Gabelli is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding CBH and Gabelli Equity Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gabelli Equity Trust and CBH 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 CBH are associated (or correlated) with Gabelli Equity. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gabelli Equity Trust has no effect on the direction of CBH i.e., CBH and Gabelli Equity go up and down completely randomly.

Pair Corralation between CBH and Gabelli Equity

If you would invest  522.00  in Gabelli Equity Trust on December 27, 2024 and sell it today you would earn a total of  31.00  from holding Gabelli Equity Trust or generate 5.94% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

CBH  vs.  Gabelli Equity Trust

CBH

Risk-Adjusted Performance

Very Weak

Over the last 90 days CBH has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong fundamental drivers, CBH is not utilizing all of its potentials. The newest stock price confusion, may contribute to short-horizon losses for the traders.

Gabelli Equity Trust

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Gabelli Equity Trust are ranked lower than 8 (%) of all funds and portfolios of funds over the last 90 days. Despite somewhat uncertain basic indicators, Gabelli Equity may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with CBH and Gabelli Equity

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

The idea behind CBH and Gabelli Equity Trust 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.

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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.