Correlation Between Gabelli Global and Calamos Dynamic

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

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

Diversification Opportunities for Gabelli Global and Calamos Dynamic

0.73

Correlation Coefficient

Gabelli Global  Calamos Dynamic

Poor diversification

The 3 months correlation between Gabelli and Calamos is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Gabelli Global Small and Calamos Dynamic Convertible in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Calamos Dynamic Conv and Gabelli Global 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 Global Small are associated (or correlated) with Calamos Dynamic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Calamos Dynamic Conv has no effect on the direction of Gabelli Global i.e., Gabelli Global and Calamos Dynamic go up and down completely randomly.

Pair Corralation between Gabelli Global and Calamos Dynamic

Considering the 90-day investment horizon Gabelli Global is expected to generate 1.7 times less return on investment than Calamos Dynamic. In addition to that, Gabelli Global is 1.01 times more volatile than Calamos Dynamic Convertible. It trades about 0.2 of its total potential returns per unit of risk. Calamos Dynamic Convertible is currently generating about 0.33 per unit of volatility. If you would invest  2,212  in Calamos Dynamic Convertible on July 3, 2024 and sell it today you would earn a total of  328.00  from holding Calamos Dynamic Convertible or generate 14.83% return on investment over 90 days.

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

Gabelli Global Small  vs.  Calamos Dynamic Convertible

Gabelli Global Small

Risk-Adjusted Performance

11 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Gabelli Global Small are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. In spite of fairly unsteady technical and fundamental indicators, Gabelli Global may actually be approaching a critical reversion point that can send shares even higher in November 2024.

Calamos Dynamic Conv

Risk-Adjusted Performance

15 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Calamos Dynamic Convertible are ranked lower than 15 (%) of all funds and portfolios of funds over the last 90 days. In spite of rather inconsistent fundamental indicators, Calamos Dynamic exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Gabelli Global and Calamos Dynamic

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

The idea behind Gabelli Global Small and Calamos Dynamic Convertible 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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..