Correlation Between Eaton Vance and Gabelli Global

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

By analyzing existing cross correlation between Eaton Vance National and Gabelli Global Utility, you can compare the effects of market volatilities on Eaton Vance and Gabelli 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 Eaton Vance with a short position of Gabelli Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eaton Vance and Gabelli Global.

Diversification Opportunities for Eaton Vance and Gabelli Global

-0.46

Correlation Coefficient

Eaton Vance  Gabelli Global

Very good diversification

The 3 months correlation between Eaton and Gabelli is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding Eaton Vance National and Gabelli Global Utility in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gabelli Global Utility and Eaton Vance 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 Eaton Vance National are associated (or correlated) with Gabelli Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gabelli Global Utility has no effect on the direction of Eaton Vance i.e., Eaton Vance and Gabelli Global go up and down completely randomly.

Pair Corralation between Eaton Vance and Gabelli Global

Considering the 90-day investment horizon Eaton Vance is expected to generate 7.34 times less return on investment than Gabelli Global. But when comparing it to its historical volatility, Eaton Vance National is 1.79 times less risky than Gabelli Global. It trades about 0.03 of its potential returns per unit of risk. Gabelli Global Utility is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest  1,596  in Gabelli Global Utility on September 16, 2024 and sell it today you would earn a total of  36.00  from holding Gabelli Global Utility or generate 2.26% return on investment over 90 days.

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

Eaton Vance National  vs.  Gabelli Global Utility

Eaton Vance National

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Eaton Vance National has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Eaton Vance is not utilizing all of its potentials. The latest stock price uproar, may contribute to short-horizon losses for the private investors.

Gabelli Global Utility

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Gabelli Global Utility are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable essential indicators, Gabelli Global is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Eaton Vance and Gabelli Global

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

The idea behind Eaton Vance National and Gabelli Global Utility 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 Bonds Directory module to find actively traded corporate debentures issued by US companies.