Correlation Between Gabelli Convertible and Marsico Focus

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

By analyzing existing cross correlation between Gabelli Convertible And and Marsico Focus, you can compare the effects of market volatilities on Gabelli Convertible and Marsico Focus 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 Gabelli Convertible with a short position of Marsico Focus. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gabelli Convertible and Marsico Focus.

Diversification Opportunities for Gabelli Convertible and Marsico Focus

0.86

Correlation Coefficient

Gabelli Convertible  Marsico Focus

Very poor diversification

The 3 months correlation between Gabelli and Marsico is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Gabelli Convertible And and Marsico Focus in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Marsico Focus and Gabelli Convertible 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 Gabelli Convertible And are associated (or correlated) with Marsico Focus. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Marsico Focus has no effect on the direction of Gabelli Convertible i.e., Gabelli Convertible and Marsico Focus go up and down completely randomly.

Pair Corralation between Gabelli Convertible and Marsico Focus

Considering the 90-day investment horizon Gabelli Convertible And is expected to generate 0.88 times more return on investment than Marsico Focus. However, Gabelli Convertible And is 1.14 times less risky than Marsico Focus. It trades about 0.08 of its potential returns per unit of risk. Marsico Focus is currently generating about 0.02 per unit of risk. If you would invest  359.00  in Gabelli Convertible And on September 25, 2024 and sell it today you would earn a total of  18.00  from holding Gabelli Convertible And or generate 5.01% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Strong
Accuracy	100.0%
Values	Daily Returns

Gabelli Convertible And  vs.  Marsico Focus

Gabelli Convertible And

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Gabelli Convertible And are ranked lower than 6 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly stable fundamental indicators, Gabelli Convertible is not utilizing all of its potentials. The current stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Marsico Focus

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Marsico Focus are ranked lower than 1 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, Marsico Focus is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Gabelli Convertible and Marsico Focus

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

The idea behind Gabelli Convertible And and Marsico Focus 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 Equity Valuation module to check real value of public entities based on technical and fundamental data.