Correlation Between Western Asset and Gabelli Val
Can any of the company-specific risk be diversified away by investing in both Western Asset and Gabelli Val 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 Western Asset and Gabelli Val into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Western Asset Diversified and The Gabelli Val, you can compare the effects of market volatilities on Western Asset and Gabelli Val 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 Western Asset with a short position of Gabelli Val. Check out your portfolio center. Please also check ongoing floating volatility patterns of Western Asset and Gabelli Val.
Diversification Opportunities for Western Asset and Gabelli Val
-0.45 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Western and Gabelli is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding Western Asset Diversified and The Gabelli Val in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gabelli Val and Western Asset 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 Western Asset Diversified are associated (or correlated) with Gabelli Val. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gabelli Val has no effect on the direction of Western Asset i.e., Western Asset and Gabelli Val go up and down completely randomly.
Pair Corralation between Western Asset and Gabelli Val
Assuming the 90 days horizon Western Asset Diversified is expected to under-perform the Gabelli Val. But the mutual fund apears to be less risky and, when comparing its historical volatility, Western Asset Diversified is 2.69 times less risky than Gabelli Val. The mutual fund trades about -0.07 of its potential returns per unit of risk. The The Gabelli Val is currently generating about 0.22 of returns per unit of risk over similar time horizon. If you would invest 1,017 in The Gabelli Val on September 6, 2024 and sell it today you would earn a total of 103.00 from holding The Gabelli Val or generate 10.13% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Western Asset Diversified vs. The Gabelli Val
Performance |
Timeline |
Western Asset Diversified |
Gabelli Val |
Western Asset and Gabelli Val Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Western Asset and Gabelli Val
The main advantage of trading using opposite Western Asset and Gabelli Val positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Western Asset position performs unexpectedly, Gabelli Val 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 Val will offset losses from the drop in Gabelli Val's long position.Western Asset vs. Goldman Sachs Short | Western Asset vs. Vanguard Institutional Short Term | Western Asset vs. Maryland Short Term Tax Free | Western Asset vs. Sterling Capital Short |
Gabelli Val vs. Boston Partners Small | Gabelli Val vs. Lord Abbett Small | Gabelli Val vs. Ab Discovery Value | Gabelli Val vs. Ab Small Cap |
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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
Other Complementary Tools
Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
Commodity Channel Use Commodity Channel Index to analyze current equity momentum | |
Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk | |
Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments |