Correlation Between Goldman Sachs and Federated Short
Can any of the company-specific risk be diversified away by investing in both Goldman Sachs and Federated Short 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 Goldman Sachs and Federated Short into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Goldman Sachs Emerging and Federated Short Term Income, you can compare the effects of market volatilities on Goldman Sachs and Federated Short 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 Goldman Sachs with a short position of Federated Short. Check out your portfolio center. Please also check ongoing floating volatility patterns of Goldman Sachs and Federated Short.
Diversification Opportunities for Goldman Sachs and Federated Short
-0.14 | Correlation Coefficient |
Good diversification
The 3 months correlation between Goldman and Federated is -0.14. Overlapping area represents the amount of risk that can be diversified away by holding Goldman Sachs Emerging and Federated Short Term Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Federated Short Term and Goldman Sachs 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 Goldman Sachs Emerging are associated (or correlated) with Federated Short. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Federated Short Term has no effect on the direction of Goldman Sachs i.e., Goldman Sachs and Federated Short go up and down completely randomly.
Pair Corralation between Goldman Sachs and Federated Short
Assuming the 90 days horizon Goldman Sachs Emerging is expected to generate 5.51 times more return on investment than Federated Short. However, Goldman Sachs is 5.51 times more volatile than Federated Short Term Income. It trades about 0.06 of its potential returns per unit of risk. Federated Short Term Income is currently generating about 0.14 per unit of risk. If you would invest 713.00 in Goldman Sachs Emerging on September 13, 2024 and sell it today you would earn a total of 191.00 from holding Goldman Sachs Emerging or generate 26.79% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Goldman Sachs Emerging vs. Federated Short Term Income
Performance |
| Timeline |
| Goldman Sachs Emerging |
| Federated Short Term |
Goldman Sachs and Federated Short Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Goldman Sachs and Federated Short
The main advantage of trading using opposite Goldman Sachs and Federated Short positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Goldman Sachs position performs unexpectedly, Federated Short 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 Federated Short will offset losses from the drop in Federated Short's long position.| Goldman Sachs vs. Pender Real Estate | Goldman Sachs vs. Fidelity Real Estate | Goldman Sachs vs. Commonwealth Real Estate | Goldman Sachs vs. Dunham Real Estate |
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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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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