Correlation Between HNI Corp and GAMCO Global

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

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

Diversification Opportunities for HNI Corp and GAMCO Global

-0.48

Correlation Coefficient

HNI Corp  GAMCO Global

Very good diversification

The 3 months correlation between HNI and GAMCO is -0.48. Overlapping area represents the amount of risk that can be diversified away by holding HNI Corp 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 HNI Corp 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 HNI Corp 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 HNI Corp i.e., HNI Corp and GAMCO Global go up and down completely randomly.

Pair Corralation between HNI Corp and GAMCO Global

Considering the 90-day investment horizon HNI Corp is expected to generate 1.45 times more return on investment than GAMCO Global. However, HNI Corp is 1.45 times more volatile than GAMCO Global Gold. It trades about 0.04 of its potential returns per unit of risk. GAMCO Global Gold is currently generating about -0.15 per unit of risk. If you would invest  5,222  in HNI Corp on September 17, 2024 and sell it today you would earn a total of  155.00  from holding HNI Corp or generate 2.97% return on investment over 90 days.

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

HNI Corp  vs.  GAMCO Global Gold

HNI Corp

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in HNI Corp are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite fairly strong basic indicators, HNI Corp is not utilizing all of its potentials. The current stock price confusion, may contribute to short-horizon losses for the traders.

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 investors with long positions. Despite latest inconsistent performance, the Preferred Stock's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

Pair Trading with HNI Corp and GAMCO Global

The main advantage of trading using opposite HNI Corp and GAMCO Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HNI Corp 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 HNI Corp 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.

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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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.