Correlation Between Gabelli Dividend and Gabelli MultiMedia

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

Diversification Opportunities for Gabelli Dividend and Gabelli MultiMedia

-0.16

Correlation Coefficient

Gabelli Dividend  Gabelli MultiMedia

Good diversification

The 3 months correlation between Gabelli and Gabelli is -0.16. Overlapping area represents the amount of risk that can be diversified away by holding Gabelli Dividend Income and Gabelli MultiMedia Mutual in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gabelli MultiMedia Mutual 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 Gabelli MultiMedia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gabelli MultiMedia Mutual has no effect on the direction of Gabelli Dividend i.e., Gabelli Dividend and Gabelli MultiMedia go up and down completely randomly.

Pair Corralation between Gabelli Dividend and Gabelli MultiMedia

Considering the 90-day investment horizon Gabelli Dividend Income is expected to generate 0.45 times more return on investment than Gabelli MultiMedia. However, Gabelli Dividend Income is 2.24 times less risky than Gabelli MultiMedia. It trades about 0.11 of its potential returns per unit of risk. Gabelli MultiMedia Mutual is currently generating about 0.01 per unit of risk. If you would invest  1,890  in Gabelli Dividend Income on August 31, 2024 and sell it today you would earn a total of  669.00  from holding Gabelli Dividend Income or generate 35.4% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Gabelli Dividend Income  vs.  Gabelli MultiMedia Mutual

Gabelli Dividend Income

Risk-Adjusted Performance

14 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Gabelli Dividend Income are ranked lower than 14 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly inconsistent fundamental indicators, Gabelli Dividend may actually be approaching a critical reversion point that can send shares even higher in December 2024.

Gabelli MultiMedia Mutual

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Gabelli MultiMedia Mutual are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable technical and fundamental indicators, Gabelli MultiMedia is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Gabelli Dividend and Gabelli MultiMedia

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

The idea behind Gabelli Dividend Income and Gabelli MultiMedia Mutual 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 Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.