Correlation Between Mainstay Epoch and Goldman Sachs
Can any of the company-specific risk be diversified away by investing in both Mainstay Epoch 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 Mainstay Epoch and Goldman Sachs into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mainstay Epoch Equity and Goldman Sachs Technology, you can compare the effects of market volatilities on Mainstay Epoch 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 Mainstay Epoch with a short position of Goldman Sachs. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mainstay Epoch and Goldman Sachs.
Diversification Opportunities for Mainstay Epoch and Goldman Sachs
0.89 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Mainstay and Goldman is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding Mainstay Epoch Equity and Goldman Sachs Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Goldman Sachs Technology and Mainstay Epoch 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 Mainstay Epoch Equity 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 Technology has no effect on the direction of Mainstay Epoch i.e., Mainstay Epoch and Goldman Sachs go up and down completely randomly.
Pair Corralation between Mainstay Epoch and Goldman Sachs
Assuming the 90 days horizon Mainstay Epoch is expected to generate 1.32 times less return on investment than Goldman Sachs. But when comparing it to its historical volatility, Mainstay Epoch Equity is 1.96 times less risky than Goldman Sachs. It trades about 0.14 of its potential returns per unit of risk. Goldman Sachs Technology is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 2,501 in Goldman Sachs Technology on September 3, 2024 and sell it today you would earn a total of 1,077 from holding Goldman Sachs Technology or generate 43.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Mainstay Epoch Equity vs. Goldman Sachs Technology
Performance |
| Timeline |
| Mainstay Epoch Equity |
| Goldman Sachs Technology |
Mainstay Epoch and Goldman Sachs Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mainstay Epoch and Goldman Sachs
The main advantage of trading using opposite Mainstay Epoch and Goldman Sachs positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mainstay Epoch 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.| Mainstay Epoch vs. Rbc Emerging Markets | Mainstay Epoch vs. Barings Emerging Markets | Mainstay Epoch vs. Mondrian Emerging Markets | Mainstay Epoch vs. Nasdaq 100 2x Strategy |
| Goldman Sachs vs. Limited Term Tax | Goldman Sachs vs. Maryland Short Term Tax Free | Goldman Sachs vs. Federated Short Term Income | Goldman Sachs vs. Vanguard Institutional Short Term |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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