Correlation Between Gamco Natural and Tiaa Cref

Can any of the company-specific risk be diversified away by investing in both Gamco Natural and Tiaa Cref 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 Tiaa Cref 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 Tiaa Cref Inflation Linked Bond, you can compare the effects of market volatilities on Gamco Natural and Tiaa Cref 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 Tiaa Cref. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gamco Natural and Tiaa Cref.

Diversification Opportunities for Gamco Natural and Tiaa Cref

0.41

Correlation Coefficient

Gamco Natural  Tiaa Cref

Very weak diversification

The 3 months correlation between Gamco and Tiaa is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding Gamco Natural Resources and Tiaa Cref Inflation Linked Bon in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tiaa Cref Inflation 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 Tiaa Cref. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tiaa Cref Inflation has no effect on the direction of Gamco Natural i.e., Gamco Natural and Tiaa Cref go up and down completely randomly.

Pair Corralation between Gamco Natural and Tiaa Cref

Assuming the 90 days horizon Gamco Natural Resources is expected to generate 3.09 times more return on investment than Tiaa Cref. However, Gamco Natural is 3.09 times more volatile than Tiaa Cref Inflation Linked Bond. It trades about 0.0 of its potential returns per unit of risk. Tiaa Cref Inflation Linked Bond is currently generating about -0.15 per unit of risk. If you would invest  650.00  in Gamco Natural Resources on September 14, 2024 and sell it today you would earn a total of  0.00  from holding Gamco Natural Resources or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	98.44%
Values	Daily Returns

Gamco Natural Resources  vs.  Tiaa Cref Inflation Linked Bon

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 fund investors. In spite of fairly strong basic indicators, Gamco Natural is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Tiaa Cref Inflation

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Tiaa Cref Inflation Linked Bond has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong basic indicators, Tiaa Cref is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Gamco Natural and Tiaa Cref

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

The idea behind Gamco Natural Resources and Tiaa Cref Inflation Linked Bond 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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.