Correlation Between Sterling Capital and Goldman Sachs
Can any of the company-specific risk be diversified away by investing in both Sterling Capital 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 Sterling Capital and Goldman Sachs into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sterling Capital Short and Goldman Sachs Absolute, you can compare the effects of market volatilities on Sterling Capital 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 Sterling Capital with a short position of Goldman Sachs. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sterling Capital and Goldman Sachs.
Diversification Opportunities for Sterling Capital and Goldman Sachs
0.5 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Sterling and Goldman is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding Sterling Capital Short and Goldman Sachs Absolute in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Goldman Sachs Absolute and Sterling Capital 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 Sterling Capital Short 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 Absolute has no effect on the direction of Sterling Capital i.e., Sterling Capital and Goldman Sachs go up and down completely randomly.
Pair Corralation between Sterling Capital and Goldman Sachs
Assuming the 90 days horizon Sterling Capital is expected to generate 1.58 times less return on investment than Goldman Sachs. But when comparing it to its historical volatility, Sterling Capital Short is 2.22 times less risky than Goldman Sachs. It trades about 0.14 of its potential returns per unit of risk. Goldman Sachs Absolute is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 732.00 in Goldman Sachs Absolute on September 12, 2024 and sell it today you would earn a total of 133.00 from holding Goldman Sachs Absolute or generate 18.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sterling Capital Short vs. Goldman Sachs Absolute
Performance |
| Timeline |
| Sterling Capital Short |
| Goldman Sachs Absolute |
Sterling Capital and Goldman Sachs Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sterling Capital and Goldman Sachs
The main advantage of trading using opposite Sterling Capital and Goldman Sachs positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sterling Capital 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.| Sterling Capital vs. Goldman Sachs Real | Sterling Capital vs. Guggenheim Risk Managed | Sterling Capital vs. Redwood Real Estate | Sterling Capital vs. Sa Real Estate |
| Goldman Sachs vs. Nasdaq 100 Index Fund | Goldman Sachs vs. Rbb Fund | Goldman Sachs vs. Qs Growth Fund | Goldman Sachs vs. T Rowe Price |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
Other Complementary Tools
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments | |
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk |