Correlation Between Gabelli Gold and Artisan High

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

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

Diversification Opportunities for Gabelli Gold and Artisan High

0.7

Correlation Coefficient

Gabelli Gold  Artisan High

Poor diversification

The 3 months correlation between Gabelli and Artisan is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding Gabelli Gold Fund and Artisan High Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Artisan High Income and Gabelli Gold 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 Gold Fund are associated (or correlated) with Artisan High. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Artisan High Income has no effect on the direction of Gabelli Gold i.e., Gabelli Gold and Artisan High go up and down completely randomly.

Pair Corralation between Gabelli Gold and Artisan High

Assuming the 90 days horizon Gabelli Gold Fund is expected to generate 7.87 times more return on investment than Artisan High. However, Gabelli Gold is 7.87 times more volatile than Artisan High Income. It trades about 0.33 of its potential returns per unit of risk. Artisan High Income is currently generating about 0.11 per unit of risk. If you would invest  2,010  in Gabelli Gold Fund on December 30, 2024 and sell it today you would earn a total of  656.00  from holding Gabelli Gold Fund or generate 32.64% return on investment over 90 days.

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

Gabelli Gold Fund  vs.  Artisan High Income

Gabelli Gold

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Gabelli Gold Fund are ranked lower than 25 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak basic indicators, Gabelli Gold showed solid returns over the last few months and may actually be approaching a breakup point.

Artisan High Income

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Artisan High Income are ranked lower than 8 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong technical and fundamental indicators, Artisan High 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 Gold and Artisan High

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

The idea behind Gabelli Gold Fund and Artisan High 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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.