Correlation Between DMY Squared and Gabelli Global

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

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

Diversification Opportunities for DMY Squared and Gabelli Global

0.75

Correlation Coefficient

DMY Squared  Gabelli Global

Poor diversification

The 3 months correlation between DMY and Gabelli is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding dMY Squared Technology and Gabelli Global Small in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gabelli Global Small and DMY Squared 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 dMY Squared Technology are associated (or correlated) with Gabelli Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gabelli Global Small has no effect on the direction of DMY Squared i.e., DMY Squared and Gabelli Global go up and down completely randomly.

Pair Corralation between DMY Squared and Gabelli Global

Given the investment horizon of 90 days dMY Squared Technology is expected to generate 1.69 times more return on investment than Gabelli Global. However, DMY Squared is 1.69 times more volatile than Gabelli Global Small. It trades about 0.16 of its potential returns per unit of risk. Gabelli Global Small is currently generating about 0.09 per unit of risk. If you would invest  1,120  in dMY Squared Technology on March 18, 2025 and sell it today you would earn a total of  296.00  from holding dMY Squared Technology or generate 26.43% return on investment over 90 days.

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

dMY Squared Technology  vs.  Gabelli Global Small

dMY Squared Technology

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in dMY Squared Technology are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal basic indicators, DMY Squared showed solid returns over the last few months and may actually be approaching a breakup point.

Gabelli Global Small

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Gabelli Global Small are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of fairly inconsistent technical and fundamental indicators, Gabelli Global may actually be approaching a critical reversion point that can send shares even higher in July 2025.

Pair Trading with DMY Squared and Gabelli Global

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

The idea behind dMY Squared Technology and Gabelli Global Small 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.