Correlation Between Guggenheim Risk and Gamco Global

Can any of the company-specific risk be diversified away by investing in both Guggenheim Risk and Gamco Global 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 Guggenheim Risk and Gamco Global into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Guggenheim Risk Managed and Gamco Global Gold, you can compare the effects of market volatilities on Guggenheim Risk and Gamco Global 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 Guggenheim Risk with a short position of Gamco Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guggenheim Risk and Gamco Global.

Diversification Opportunities for Guggenheim Risk and Gamco Global

0.52

Correlation Coefficient

Guggenheim Risk  Gamco Global

Very weak diversification

The 3 months correlation between Guggenheim and Gamco is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding Guggenheim Risk Managed and Gamco Global Gold in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gamco Global Gold and Guggenheim Risk 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 Guggenheim Risk Managed are associated (or correlated) with Gamco Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gamco Global Gold has no effect on the direction of Guggenheim Risk i.e., Guggenheim Risk and Gamco Global go up and down completely randomly.

Pair Corralation between Guggenheim Risk and Gamco Global

Assuming the 90 days horizon Guggenheim Risk Managed is expected to generate 1.03 times more return on investment than Gamco Global. However, Guggenheim Risk is 1.03 times more volatile than Gamco Global Gold. It trades about -0.25 of its potential returns per unit of risk. Gamco Global Gold is currently generating about -0.42 per unit of risk. If you would invest  3,449  in Guggenheim Risk Managed on September 22, 2024 and sell it today you would lose (193.00) from holding Guggenheim Risk Managed or give up 5.6% of portfolio value over 90 days.

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

Guggenheim Risk Managed  vs.  Gamco Global Gold

Guggenheim Risk Managed

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Guggenheim Risk Managed has generated negative risk-adjusted returns adding no value to fund investors. In spite of latest weak performance, the Fund's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the fund investors.

Gamco Global Gold

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Gamco Global Gold has generated negative risk-adjusted returns adding no value to fund investors. In spite of latest weak performance, the Fund's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the fund investors.

Pair Trading with Guggenheim Risk and Gamco Global

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

The idea behind Guggenheim Risk Managed and Gamco Global Gold 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.

Check out your portfolio center.

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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.