Correlation Between Goldman Sachs and Hartford Small
Can any of the company-specific risk be diversified away by investing in both Goldman Sachs and Hartford Small 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 Hartford Small into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Goldman Sachs Clean and Hartford Small Pany, you can compare the effects of market volatilities on Goldman Sachs and Hartford Small 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 Hartford Small. Check out your portfolio center. Please also check ongoing floating volatility patterns of Goldman Sachs and Hartford Small.
Diversification Opportunities for Goldman Sachs and Hartford Small
-0.69 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Goldman and Hartford is -0.69. Overlapping area represents the amount of risk that can be diversified away by holding Goldman Sachs Clean and Hartford Small Pany in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hartford Small Pany 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 Clean are associated (or correlated) with Hartford Small. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hartford Small Pany has no effect on the direction of Goldman Sachs i.e., Goldman Sachs and Hartford Small go up and down completely randomly.
Pair Corralation between Goldman Sachs and Hartford Small
Assuming the 90 days horizon Goldman Sachs Clean is expected to under-perform the Hartford Small. In addition to that, Goldman Sachs is 1.01 times more volatile than Hartford Small Pany. It trades about -0.12 of its total potential returns per unit of risk. Hartford Small Pany is currently generating about 0.17 per unit of volatility. If you would invest 1,712 in Hartford Small Pany on September 4, 2024 and sell it today you would earn a total of 209.00 from holding Hartford Small Pany or generate 12.21% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 98.44% |
| Values | Daily Returns |
Goldman Sachs Clean vs. Hartford Small Pany
Performance |
| Timeline |
| Goldman Sachs Clean |
| Hartford Small Pany |
Goldman Sachs and Hartford Small Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Goldman Sachs and Hartford Small
The main advantage of trading using opposite Goldman Sachs and Hartford Small positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Goldman Sachs position performs unexpectedly, Hartford Small 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 Hartford Small will offset losses from the drop in Hartford Small's long position.The idea behind Goldman Sachs Clean and Hartford Small Pany pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
| Hartford Small vs. Goldman Sachs Clean | Hartford Small vs. Gamco Global Gold | Hartford Small vs. Franklin Gold Precious | Hartford Small vs. Short Precious Metals |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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