Correlation Between Gabelli Growth and Nationwide Growth

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

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

Diversification Opportunities for Gabelli Growth and Nationwide Growth

0.94

Correlation Coefficient

Gabelli Growth  Nationwide Growth

Almost no diversification

The 3 months correlation between Gabelli and Nationwide is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding The Gabelli Growth and Nationwide Growth Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nationwide Growth and Gabelli Growth 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 The Gabelli Growth are associated (or correlated) with Nationwide Growth. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nationwide Growth has no effect on the direction of Gabelli Growth i.e., Gabelli Growth and Nationwide Growth go up and down completely randomly.

Pair Corralation between Gabelli Growth and Nationwide Growth

Assuming the 90 days horizon The Gabelli Growth is expected to generate 1.42 times more return on investment than Nationwide Growth. However, Gabelli Growth is 1.42 times more volatile than Nationwide Growth Fund. It trades about 0.18 of its potential returns per unit of risk. Nationwide Growth Fund is currently generating about 0.18 per unit of risk. If you would invest  10,878  in The Gabelli Growth on September 12, 2024 and sell it today you would earn a total of  1,211  from holding The Gabelli Growth or generate 11.13% return on investment over 90 days.

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

The Gabelli Growth  vs.  Nationwide Growth Fund

Gabelli Growth

Risk-Adjusted Performance

14 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in The Gabelli Growth are ranked lower than 14 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak basic indicators, Gabelli Growth may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Nationwide Growth

Risk-Adjusted Performance

14 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Nationwide Growth Fund are ranked lower than 14 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak basic indicators, Nationwide Growth may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with Gabelli Growth and Nationwide Growth

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

The idea behind The Gabelli Growth and Nationwide Growth Fund 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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.