Correlation Between Great West and Gabelli Gold

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

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

Diversification Opportunities for Great West and Gabelli Gold

0.4

Correlation Coefficient

Great West  Gabelli Gold

Very weak diversification

The 3 months correlation between Great and Gabelli is 0.4. Overlapping area represents the amount of risk that can be diversified away by holding Great West Goldman Sachs and Gabelli Gold Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gabelli Gold and Great West 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 Great West Goldman Sachs are associated (or correlated) with Gabelli Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gabelli Gold has no effect on the direction of Great West i.e., Great West and Gabelli Gold go up and down completely randomly.

Pair Corralation between Great West and Gabelli Gold

Assuming the 90 days horizon Great West Goldman Sachs is expected to generate 0.61 times more return on investment than Gabelli Gold. However, Great West Goldman Sachs is 1.63 times less risky than Gabelli Gold. It trades about -0.07 of its potential returns per unit of risk. Gabelli Gold Fund is currently generating about -0.13 per unit of risk. If you would invest  1,432  in Great West Goldman Sachs on May 4, 2025 and sell it today you would lose (21.00) from holding Great West Goldman Sachs or give up 1.47% of portfolio value over 90 days.

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

Great West Goldman Sachs  vs.  Gabelli Gold Fund

Great West Goldman

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Great West Goldman Sachs are ranked lower than 10 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak basic indicators, Great West may actually be approaching a critical reversion point that can send shares even higher in September 2025.

Gabelli Gold

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Gabelli Gold Fund are ranked lower than 3 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, Gabelli Gold is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Great West and Gabelli Gold

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

The idea behind Great West Goldman Sachs and Gabelli Gold 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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.