Correlation Between The Gabelli and Jpmorgan Intrepid

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

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

Diversification Opportunities for The Gabelli and Jpmorgan Intrepid

0.9

Correlation Coefficient

The Gabelli  Jpmorgan Intrepid

Almost no diversification

The 3 months correlation between The and Jpmorgan is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding The Gabelli Small and Jpmorgan Intrepid Value in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jpmorgan Intrepid Value and The Gabelli 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 The Gabelli Small are associated (or correlated) with Jpmorgan Intrepid. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jpmorgan Intrepid Value has no effect on the direction of The Gabelli i.e., The Gabelli and Jpmorgan Intrepid go up and down completely randomly.

Pair Corralation between The Gabelli and Jpmorgan Intrepid

Assuming the 90 days horizon The Gabelli Small is expected to generate 0.89 times more return on investment than Jpmorgan Intrepid. However, The Gabelli Small is 1.12 times less risky than Jpmorgan Intrepid. It trades about -0.15 of its potential returns per unit of risk. Jpmorgan Intrepid Value is currently generating about -0.14 per unit of risk. If you would invest  4,939  in The Gabelli Small on December 2, 2024 and sell it today you would lose (412.00) from holding The Gabelli Small or give up 8.34% of portfolio value over 90 days.

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

The Gabelli Small  vs.  Jpmorgan Intrepid Value

Gabelli Small

Risk-Adjusted Performance

Very Weak

Over the last 90 days The Gabelli Small has generated negative risk-adjusted returns adding no value to fund investors. In spite of latest weak performance, the Fund's forward indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the fund investors.

Jpmorgan Intrepid Value

Risk-Adjusted Performance

Very Weak

Over the last 90 days Jpmorgan Intrepid Value has generated negative risk-adjusted returns adding no value to fund investors. In spite of latest weak performance, the Fund's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the fund investors.

Pair Trading with The Gabelli and Jpmorgan Intrepid

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

The idea behind The Gabelli Small and Jpmorgan Intrepid Value 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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.