Correlation Between GAMCO Natural and Nuveen Floating

Can any of the company-specific risk be diversified away by investing in both GAMCO Natural and Nuveen Floating 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 GAMCO Natural and Nuveen Floating into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between GAMCO Natural Resources and Nuveen Floating Rate, you can compare the effects of market volatilities on GAMCO Natural and Nuveen Floating 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 GAMCO Natural with a short position of Nuveen Floating. Check out your portfolio center. Please also check ongoing floating volatility patterns of GAMCO Natural and Nuveen Floating.

Diversification Opportunities for GAMCO Natural and Nuveen Floating

-0.28

Correlation Coefficient

GAMCO Natural  Nuveen Floating

Very good diversification

The 3 months correlation between GAMCO and Nuveen is -0.28. Overlapping area represents the amount of risk that can be diversified away by holding GAMCO Natural Resources and Nuveen Floating Rate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nuveen Floating Rate and GAMCO Natural 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 GAMCO Natural Resources are associated (or correlated) with Nuveen Floating. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nuveen Floating Rate has no effect on the direction of GAMCO Natural i.e., GAMCO Natural and Nuveen Floating go up and down completely randomly.

Pair Corralation between GAMCO Natural and Nuveen Floating

Considering the 90-day investment horizon GAMCO Natural Resources is expected to under-perform the Nuveen Floating. In addition to that, GAMCO Natural is 1.61 times more volatile than Nuveen Floating Rate. It trades about -0.09 of its total potential returns per unit of risk. Nuveen Floating Rate is currently generating about 0.03 per unit of volatility. If you would invest  873.00  in Nuveen Floating Rate on October 14, 2024 and sell it today you would earn a total of  11.00  from holding Nuveen Floating Rate or generate 1.26% return on investment over 90 days.

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

GAMCO Natural Resources  vs.  Nuveen Floating Rate

GAMCO Natural Resources

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days GAMCO Natural Resources has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest inconsistent performance, the Etf's basic indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the exchange-traded fund private investors.

Nuveen Floating Rate

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Nuveen Floating Rate are ranked lower than 2 (%) of all funds and portfolios of funds over the last 90 days. Even with relatively invariable technical and fundamental indicators, Nuveen Floating is not utilizing all of its potentials. The latest stock price agitation, may contribute to short-term losses for the retail investors.

Pair Trading with GAMCO Natural and Nuveen Floating

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

The idea behind GAMCO Natural Resources and Nuveen Floating Rate 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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.