Correlation Between Gamco Global and Mainstay High
Can any of the company-specific risk be diversified away by investing in both Gamco Global and Mainstay High 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 Mainstay High into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Gamco Global Telecommunications and Mainstay High Yield, you can compare the effects of market volatilities on Gamco Global and Mainstay High 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 Mainstay High. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gamco Global and Mainstay High.
Diversification Opportunities for Gamco Global and Mainstay High
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Gamco and Mainstay is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Gamco Global Telecommunication and Mainstay High Yield in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mainstay High Yield 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 Telecommunications are associated (or correlated) with Mainstay High. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mainstay High Yield has no effect on the direction of Gamco Global i.e., Gamco Global and Mainstay High go up and down completely randomly.
Pair Corralation between Gamco Global and Mainstay High
Assuming the 90 days horizon Gamco Global Telecommunications is expected to generate 2.63 times more return on investment than Mainstay High. However, Gamco Global is 2.63 times more volatile than Mainstay High Yield. It trades about 0.12 of its potential returns per unit of risk. Mainstay High Yield is currently generating about -0.06 per unit of risk. If you would invest 2,149 in Gamco Global Telecommunications on December 28, 2024 and sell it today you would earn a total of 119.00 from holding Gamco Global Telecommunications or generate 5.54% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Gamco Global Telecommunication vs. Mainstay High Yield
Performance |
Timeline |
Gamco Global Telecom |
Mainstay High Yield |
Gamco Global and Mainstay High Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Gamco Global and Mainstay High
The main advantage of trading using opposite Gamco Global and Mainstay High positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gamco Global position performs unexpectedly, Mainstay High 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 Mainstay High will offset losses from the drop in Mainstay High's long position.Gamco Global vs. American Century High | Gamco Global vs. Siit High Yield | Gamco Global vs. Legg Mason Partners | Gamco Global vs. Pace High Yield |
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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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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