Correlation Between GAMCO Investors and Nuveen SP

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

By analyzing existing cross correlation between GAMCO Investors and Nuveen SP 500, you can compare the effects of market volatilities on GAMCO Investors and Nuveen SP 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 Nuveen SP. Check out your portfolio center. Please also check ongoing floating volatility patterns of GAMCO Investors and Nuveen SP.

Diversification Opportunities for GAMCO Investors and Nuveen SP

-0.07

Correlation Coefficient

GAMCO Investors  Nuveen SP

Good diversification

The 3 months correlation between GAMCO and Nuveen is -0.07. Overlapping area represents the amount of risk that can be diversified away by holding GAMCO Investors and Nuveen SP 500 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nuveen SP 500 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 Nuveen SP. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nuveen SP 500 has no effect on the direction of GAMCO Investors i.e., GAMCO Investors and Nuveen SP go up and down completely randomly.

Pair Corralation between GAMCO Investors and Nuveen SP

Given the investment horizon of 90 days GAMCO Investors is expected to generate 3.56 times more return on investment than Nuveen SP. However, GAMCO Investors is 3.56 times more volatile than Nuveen SP 500. It trades about 0.18 of its potential returns per unit of risk. Nuveen SP 500 is currently generating about 0.05 per unit of risk. If you would invest  1,539  in GAMCO Investors on September 4, 2024 and sell it today you would earn a total of  281.00  from holding GAMCO Investors or generate 18.26% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	7.68%
Values	Daily Returns

GAMCO Investors  vs.  Nuveen SP 500

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.

Nuveen SP 500

Risk-Adjusted Performance

21 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Nuveen SP 500 are ranked lower than 21 (%) of all global equities and portfolios over the last 90 days. In spite of fairly inconsistent basic indicators, Nuveen SP may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with GAMCO Investors and Nuveen SP

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

The idea behind GAMCO Investors and Nuveen SP 500 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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.