Correlation Between Eaton Vance and Goldman Sachs
Can any of the company-specific risk be diversified away by investing in both Eaton Vance 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 Eaton Vance and Goldman Sachs into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Eaton Vance Short and Goldman Sachs High, you can compare the effects of market volatilities on Eaton Vance 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 Eaton Vance with a short position of Goldman Sachs. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eaton Vance and Goldman Sachs.
Diversification Opportunities for Eaton Vance and Goldman Sachs
0.49 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Eaton and GOLDMAN is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding Eaton Vance Short and Goldman Sachs High in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Goldman Sachs High and Eaton Vance 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 Eaton Vance 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 High has no effect on the direction of Eaton Vance i.e., Eaton Vance and Goldman Sachs go up and down completely randomly.
Pair Corralation between Eaton Vance and Goldman Sachs
Assuming the 90 days horizon Eaton Vance Short is expected to generate 0.37 times more return on investment than Goldman Sachs. However, Eaton Vance Short is 2.72 times less risky than Goldman Sachs. It trades about -0.02 of its potential returns per unit of risk. Goldman Sachs High is currently generating about -0.04 per unit of risk. If you would invest 990.00 in Eaton Vance Short on August 28, 2024 and sell it today you would lose (1.00) from holding Eaton Vance Short or give up 0.1% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 97.67% |
| Values | Daily Returns |
Eaton Vance Short vs. Goldman Sachs High
Performance |
| Timeline |
| Eaton Vance Short |
| Goldman Sachs High |
Eaton Vance and Goldman Sachs Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Eaton Vance and Goldman Sachs
The main advantage of trading using opposite Eaton Vance and Goldman Sachs positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eaton Vance 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.| Eaton Vance vs. Goldman Sachs High | Eaton Vance vs. Pioneer High Income | Eaton Vance vs. Pace High Yield | Eaton Vance vs. Pace High Yield |
| Goldman Sachs vs. Alger Health Sciences | Goldman Sachs vs. Alphacentric Lifesci Healthcare | Goldman Sachs vs. Fidelity Advisor Health | Goldman Sachs vs. The Gabelli Healthcare |
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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