Correlation Between Gamco Global and Blackrock Lifepath

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Can any of the company-specific risk be diversified away by investing in both Gamco Global and Blackrock Lifepath 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 Global and Blackrock Lifepath into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Gamco Global Gold and Blackrock Lifepath Dynamic, you can compare the effects of market volatilities on Gamco Global and Blackrock Lifepath 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 Global with a short position of Blackrock Lifepath. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gamco Global and Blackrock Lifepath.

Diversification Opportunities for Gamco Global and Blackrock Lifepath

0.55
  Correlation Coefficient

Very weak diversification

The 3 months correlation between Gamco and Blackrock is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding Gamco Global Gold and Blackrock Lifepath Dynamic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Blackrock Lifepath and Gamco Global 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 Global Gold are associated (or correlated) with Blackrock Lifepath. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Blackrock Lifepath has no effect on the direction of Gamco Global i.e., Gamco Global and Blackrock Lifepath go up and down completely randomly.

Pair Corralation between Gamco Global and Blackrock Lifepath

Assuming the 90 days horizon Gamco Global Gold is expected to under-perform the Blackrock Lifepath. In addition to that, Gamco Global is 1.11 times more volatile than Blackrock Lifepath Dynamic. It trades about -0.07 of its total potential returns per unit of risk. Blackrock Lifepath Dynamic is currently generating about -0.05 per unit of volatility. If you would invest  1,743  in Blackrock Lifepath Dynamic on October 28, 2024 and sell it today you would lose (47.00) from holding Blackrock Lifepath Dynamic or give up 2.7% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthWeak
Accuracy100.0%
ValuesDaily Returns

Gamco Global Gold  vs.  Blackrock Lifepath Dynamic

 Performance 
JavaScript chart by amCharts 3.21.15NovDec2025 -12-10-8-6-4-202
JavaScript chart by amCharts 3.21.15XGGNX LPCKX
       Timeline  
Gamco Global Gold 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
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 fairly strong basic indicators, Gamco Global is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.
JavaScript chart by amCharts 3.21.15NovDecJanDecJan3.853.93.9544.054.14.154.24.25
Blackrock Lifepath 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Blackrock Lifepath Dynamic has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong forward-looking signals, Blackrock Lifepath is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.
JavaScript chart by amCharts 3.21.15NovDecJanDecJan16.416.616.81717.217.417.617.818

Gamco Global and Blackrock Lifepath Volatility Contrast

   Predicted Return Density   
JavaScript chart by amCharts 3.21.15-1.49-1.12-0.75-0.38-0.05590.20.570.941.311.68 0.10.20.30.40.50.6
JavaScript chart by amCharts 3.21.15XGGNX LPCKX
       Returns  

Pair Trading with Gamco Global and Blackrock Lifepath

The main advantage of trading using opposite Gamco Global and Blackrock Lifepath positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gamco Global position performs unexpectedly, Blackrock Lifepath 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 Blackrock Lifepath will offset losses from the drop in Blackrock Lifepath's long position.
The idea behind Gamco Global Gold and Blackrock Lifepath Dynamic 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 Dashboard module to portfolio dashboard that provides centralized access to all your investments.

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