Correlation Between Ab Select and Goldman Sachs
Can any of the company-specific risk be diversified away by investing in both Ab Select and Goldman Sachs 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 Ab Select and Goldman Sachs into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ab Select Longshort and Goldman Sachs Short, you can compare the effects of market volatilities on Ab Select and Goldman Sachs 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 Ab Select with a short position of Goldman Sachs. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ab Select and Goldman Sachs.
Diversification Opportunities for Ab Select and Goldman Sachs
-0.48 | Correlation Coefficient |
Very good diversification
The 3 months correlation between ASCLX and GOLDMAN is -0.48. Overlapping area represents the amount of risk that can be diversified away by holding Ab Select Longshort and Goldman Sachs Short in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Goldman Sachs Short and Ab Select 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 Ab Select Longshort are associated (or correlated) with Goldman Sachs. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Goldman Sachs Short has no effect on the direction of Ab Select i.e., Ab Select and Goldman Sachs go up and down completely randomly.
Pair Corralation between Ab Select and Goldman Sachs
Assuming the 90 days horizon Ab Select Longshort is expected to generate 7.2 times more return on investment than Goldman Sachs. However, Ab Select is 7.2 times more volatile than Goldman Sachs Short. It trades about 0.37 of its potential returns per unit of risk. Goldman Sachs Short is currently generating about 0.2 per unit of risk. If you would invest 1,352 in Ab Select Longshort on September 4, 2024 and sell it today you would earn a total of 56.00 from holding Ab Select Longshort or generate 4.14% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ab Select Longshort vs. Goldman Sachs Short
Performance |
| Timeline |
| Ab Select Longshort |
| Goldman Sachs Short |
Ab Select and Goldman Sachs Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ab Select and Goldman Sachs
The main advantage of trading using opposite Ab Select and Goldman Sachs positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ab Select position performs unexpectedly, Goldman Sachs 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 Goldman Sachs will offset losses from the drop in Goldman Sachs' long position.| Ab Select vs. Aig Government Money | Ab Select vs. Schwab Treasury Money | Ab Select vs. Rbc Funds Trust | Ab Select vs. Lord Abbett Emerging |
| Goldman Sachs vs. Goldman Sachs Clean | Goldman Sachs vs. Goldman Sachs Clean | Goldman Sachs vs. Goldman Sachs Clean | Goldman Sachs vs. Goldman Sachs Clean |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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