Correlation Between Global X and Goldman Sachs
Can any of the company-specific risk be diversified away by investing in both Global X 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 Global X and Goldman Sachs into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Global X Autonomous and Goldman Sachs Future, you can compare the effects of market volatilities on Global X 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 Global X with a short position of Goldman Sachs. Check out your portfolio center. Please also check ongoing floating volatility patterns of Global X and Goldman Sachs.
Diversification Opportunities for Global X and Goldman Sachs
-0.37 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Global and Goldman is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding Global X Autonomous and Goldman Sachs Future in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Goldman Sachs Future and Global X 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 Global X Autonomous 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 Future has no effect on the direction of Global X i.e., Global X and Goldman Sachs go up and down completely randomly.
Pair Corralation between Global X and Goldman Sachs
Given the investment horizon of 90 days Global X Autonomous is expected to generate 2.08 times more return on investment than Goldman Sachs. However, Global X is 2.08 times more volatile than Goldman Sachs Future. It trades about 0.04 of its potential returns per unit of risk. Goldman Sachs Future is currently generating about -0.04 per unit of risk. If you would invest 2,278 in Global X Autonomous on August 23, 2024 and sell it today you would earn a total of 64.00 from holding Global X Autonomous or generate 2.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Global X Autonomous vs. Goldman Sachs Future
Performance |
| Timeline |
| Global X Autonomous |
| Goldman Sachs Future |
Global X and Goldman Sachs Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Global X and Goldman Sachs
The main advantage of trading using opposite Global X and Goldman Sachs positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Global X 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.| Global X vs. iShares Exponential Technologies | Global X vs. Invesco Solar ETF | Global X vs. First Trust NASDAQ | Global X vs. Amplify ETF Trust |
| Goldman Sachs vs. iShares Exponential Technologies | Goldman Sachs vs. Invesco Solar ETF | Goldman Sachs vs. First Trust NASDAQ | Goldman Sachs vs. Global X Autonomous |
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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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