Correlation Between Gabelli Dividend and Calamos Convertible

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

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

Diversification Opportunities for Gabelli Dividend and Calamos Convertible

0.14

Correlation Coefficient

Gabelli Dividend  Calamos Convertible

Average diversification

The 3 months correlation between Gabelli and Calamos is 0.14. Overlapping area represents the amount of risk that can be diversified away by holding Gabelli Dividend Income and Calamos Convertible Opportunit in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Calamos Convertible and Gabelli Dividend 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 Dividend Income are associated (or correlated) with Calamos Convertible. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Calamos Convertible has no effect on the direction of Gabelli Dividend i.e., Gabelli Dividend and Calamos Convertible go up and down completely randomly.

Pair Corralation between Gabelli Dividend and Calamos Convertible

Considering the 90-day investment horizon Gabelli Dividend Income is expected to generate 0.77 times more return on investment than Calamos Convertible. However, Gabelli Dividend Income is 1.3 times less risky than Calamos Convertible. It trades about 0.06 of its potential returns per unit of risk. Calamos Convertible Opportunities is currently generating about -0.31 per unit of risk. If you would invest  2,369  in Gabelli Dividend Income on December 28, 2024 and sell it today you would earn a total of  61.00  from holding Gabelli Dividend Income or generate 2.57% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	98.36%
Values	Daily Returns

Gabelli Dividend Income  vs.  Calamos Convertible Opportunit

Gabelli Dividend Income

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Gabelli Dividend Income are ranked lower than 4 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly stable fundamental indicators, Gabelli Dividend is not utilizing all of its potentials. The newest stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Calamos Convertible

Risk-Adjusted Performance

Very Weak

Over the last 90 days Calamos Convertible Opportunities has generated negative risk-adjusted returns adding no value to fund investors. Despite unsteady performance in the last few months, the Fund's technical indicators remain fairly strong which may send shares a bit higher in April 2025. The recent confusion may also be a sign of long-lasting up-swing for the fund traders.

Pair Trading with Gabelli Dividend and Calamos Convertible

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

The idea behind Gabelli Dividend Income and Calamos Convertible Opportunities 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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.