Correlation Between Gabelli Convertible and Lkcm Fixed

Can any of the company-specific risk be diversified away by investing in both Gabelli Convertible and Lkcm Fixed 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 Lkcm Fixed 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 Lkcm Fixed Income, you can compare the effects of market volatilities on Gabelli Convertible and Lkcm Fixed 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 Lkcm Fixed. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gabelli Convertible and Lkcm Fixed.

Diversification Opportunities for Gabelli Convertible and Lkcm Fixed

0.21

Correlation Coefficient

Gabelli Convertible  Lkcm Fixed

Modest diversification

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

Pair Corralation between Gabelli Convertible and Lkcm Fixed

Considering the 90-day investment horizon Gabelli Convertible And is expected to generate 6.36 times more return on investment than Lkcm Fixed. However, Gabelli Convertible is 6.36 times more volatile than Lkcm Fixed Income. It trades about 0.05 of its potential returns per unit of risk. Lkcm Fixed Income is currently generating about 0.21 per unit of risk. If you would invest  365.00  in Gabelli Convertible And on December 21, 2024 and sell it today you would earn a total of  11.00  from holding Gabelli Convertible And or generate 3.01% return on investment over 90 days.

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

Gabelli Convertible And  vs.  Lkcm Fixed Income

Gabelli Convertible And

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Gabelli Convertible And are ranked lower than 3 (%) 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.

Lkcm Fixed Income

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Lkcm Fixed Income are ranked lower than 16 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong forward indicators, Lkcm Fixed is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Gabelli Convertible and Lkcm Fixed

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

The idea behind Gabelli Convertible And and Lkcm Fixed Income 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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.