Correlation Between 70082LAB3 and The Gabelli

Can any of the company-specific risk be diversified away by investing in both 70082LAB3 and The Gabelli 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 70082LAB3 and The Gabelli into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between US70082LAB36 and The Gabelli Growth, you can compare the effects of market volatilities on 70082LAB3 and The Gabelli 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 70082LAB3 with a short position of The Gabelli. Check out your portfolio center. Please also check ongoing floating volatility patterns of 70082LAB3 and The Gabelli.

Diversification Opportunities for 70082LAB3 and The Gabelli

0.54

Correlation Coefficient

70082LAB3  The Gabelli

Very weak diversification

The 3 months correlation between 70082LAB3 and The is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding US70082LAB36 and The Gabelli Growth in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gabelli Growth and 70082LAB3 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 US70082LAB36 are associated (or correlated) with The Gabelli. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gabelli Growth has no effect on the direction of 70082LAB3 i.e., 70082LAB3 and The Gabelli go up and down completely randomly.

Pair Corralation between 70082LAB3 and The Gabelli

Assuming the 90 days trading horizon US70082LAB36 is expected to under-perform the The Gabelli. In addition to that, 70082LAB3 is 2.17 times more volatile than The Gabelli Growth. It trades about -0.17 of its total potential returns per unit of risk. The Gabelli Growth is currently generating about -0.09 per unit of volatility. If you would invest  11,203  in The Gabelli Growth on December 30, 2024 and sell it today you would lose (1,044) from holding The Gabelli Growth or give up 9.32% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	61.29%
Values	Daily Returns

US70082LAB36  vs.  The Gabelli Growth

US70082LAB36

Risk-Adjusted Performance

Very Weak

Over the last 90 days US70082LAB36 has generated negative risk-adjusted returns adding no value to investors with long positions. Despite inconsistent performance in the last few months, the Bond's basic indicators remain somewhat strong which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long term up-swing for US70082LAB36 investors.

Gabelli Growth

Risk-Adjusted Performance

Very Weak

Over the last 90 days The Gabelli Growth has generated negative risk-adjusted returns adding no value to fund investors. In spite of latest weak performance, the Fund's technical and fundamental 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 70082LAB3 and The Gabelli

The main advantage of trading using opposite 70082LAB3 and The Gabelli positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 70082LAB3 position performs unexpectedly, The Gabelli 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 The Gabelli will offset losses from the drop in The Gabelli's long position.

The idea behind US70082LAB36 and The Gabelli Growth 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 Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.