Correlation Between Gabelli Convertible and Equus Total

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

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

Diversification Opportunities for Gabelli Convertible and Equus Total

0.35

Correlation Coefficient

Gabelli Convertible  Equus Total

Weak diversification

The 3 months correlation between Gabelli and Equus is 0.35. Overlapping area represents the amount of risk that can be diversified away by holding Gabelli Convertible And and Equus Total Return in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Equus Total Return and Gabelli Convertible 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 Gabelli Convertible And are associated (or correlated) with Equus Total. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Equus Total Return has no effect on the direction of Gabelli Convertible i.e., Gabelli Convertible and Equus Total go up and down completely randomly.

Pair Corralation between Gabelli Convertible and Equus Total

Considering the 90-day investment horizon Gabelli Convertible is expected to generate 1.44 times less return on investment than Equus Total. But when comparing it to its historical volatility, Gabelli Convertible And is 4.02 times less risky than Equus Total. It trades about 0.07 of its potential returns per unit of risk. Equus Total Return is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest  108.00  in Equus Total Return on December 28, 2024 and sell it today you would earn a total of  1.00  from holding Equus Total Return or generate 0.93% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	98.33%
Values	Daily Returns

Gabelli Convertible And  vs.  Equus Total Return

Gabelli Convertible And

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Gabelli Convertible And are ranked lower than 5 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly stable fundamental indicators, Gabelli Convertible is not utilizing all of its potentials. The current stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Equus Total Return

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Equus Total Return are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unsteady basic indicators, Equus Total may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with Gabelli Convertible and Equus Total

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

The idea behind Gabelli Convertible And and Equus Total Return 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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.