Correlation Between Gabelli Equity and Unified Series

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Can any of the company-specific risk be diversified away by investing in both Gabelli Equity and Unified Series 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 Equity and Unified Series into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Gabelli Equity Trust and Unified Series Trust, you can compare the effects of market volatilities on Gabelli Equity and Unified Series 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 Equity with a short position of Unified Series. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gabelli Equity and Unified Series.

Diversification Opportunities for Gabelli Equity and Unified Series

0.89
  Correlation Coefficient

Very poor diversification

The 3 months correlation between Gabelli and Unified is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding Gabelli Equity Trust and Unified Series Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Unified Series Trust and Gabelli Equity 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 Equity Trust are associated (or correlated) with Unified Series. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Unified Series Trust has no effect on the direction of Gabelli Equity i.e., Gabelli Equity and Unified Series go up and down completely randomly.

Pair Corralation between Gabelli Equity and Unified Series

Considering the 90-day investment horizon Gabelli Equity is expected to generate 2.99 times less return on investment than Unified Series. In addition to that, Gabelli Equity is 1.18 times more volatile than Unified Series Trust. It trades about 0.03 of its total potential returns per unit of risk. Unified Series Trust is currently generating about 0.09 per unit of volatility. If you would invest  2,093  in Unified Series Trust on December 20, 2023 and sell it today you would earn a total of  582.00  from holding Unified Series Trust or generate 27.81% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthStrong
Accuracy99.7%
ValuesDaily Returns

Gabelli Equity Trust  vs.  Unified Series Trust

 Performance 
       Timeline  
Gabelli Equity Trust 

Risk-Adjusted Performance

18 of 100

 
Low
 
High
Good
Compared to the overall equity markets, risk-adjusted returns on investments in Gabelli Equity Trust are ranked lower than 18 (%) of all funds and portfolios of funds over the last 90 days. Despite somewhat weak basic indicators, Gabelli Equity may actually be approaching a critical reversion point that can send shares even higher in April 2024.
Unified Series Trust 

Risk-Adjusted Performance

13 of 100

 
Low
 
High
Good
Compared to the overall equity markets, risk-adjusted returns on investments in Unified Series Trust are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady essential indicators, Unified Series may actually be approaching a critical reversion point that can send shares even higher in April 2024.

Gabelli Equity and Unified Series Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Gabelli Equity and Unified Series

The main advantage of trading using opposite Gabelli Equity and Unified Series positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gabelli Equity position performs unexpectedly, Unified Series 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 Unified Series will offset losses from the drop in Unified Series' long position.
The idea behind Gabelli Equity Trust and Unified Series Trust 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.
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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.

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