Correlation Between GAMCO Investors and BlackRock Floating

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

By analyzing existing cross correlation between GAMCO Investors and BlackRock Floating Rate, you can compare the effects of market volatilities on GAMCO Investors and BlackRock Floating 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 Investors with a short position of BlackRock Floating. Check out your portfolio center. Please also check ongoing floating volatility patterns of GAMCO Investors and BlackRock Floating.

Diversification Opportunities for GAMCO Investors and BlackRock Floating

-0.21

Correlation Coefficient

GAMCO Investors  BlackRock Floating

Very good diversification

The 3 months correlation between GAMCO and BlackRock is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding GAMCO Investors and BlackRock Floating Rate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BlackRock Floating Rate and GAMCO Investors 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 Investors are associated (or correlated) with BlackRock Floating. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BlackRock Floating Rate has no effect on the direction of GAMCO Investors i.e., GAMCO Investors and BlackRock Floating go up and down completely randomly.

Pair Corralation between GAMCO Investors and BlackRock Floating

If you would invest  1,250  in BlackRock Floating Rate on September 12, 2024 and sell it today you would earn a total of  84.00  from holding BlackRock Floating Rate or generate 6.72% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	1.56%
Values	Daily Returns

GAMCO Investors  vs.  BlackRock Floating Rate

GAMCO Investors

Risk-Adjusted Performance

0 of 100

Very Weak

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

BlackRock Floating Rate

Risk-Adjusted Performance

11 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in BlackRock Floating Rate are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively weak technical and fundamental indicators, BlackRock Floating may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with GAMCO Investors and BlackRock Floating

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

The idea behind GAMCO Investors and BlackRock Floating Rate 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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.