Correlation Between Goldman Sachs and Columbia Floating
Can any of the company-specific risk be diversified away by investing in both Goldman Sachs and Columbia Floating 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 Columbia Floating into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Goldman Sachs Short and Columbia Floating Rate, you can compare the effects of market volatilities on Goldman Sachs and Columbia Floating 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 Columbia Floating. Check out your portfolio center. Please also check ongoing floating volatility patterns of Goldman Sachs and Columbia Floating.
Diversification Opportunities for Goldman Sachs and Columbia Floating
-0.44 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Goldman and Columbia is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding Goldman Sachs Short and Columbia Floating Rate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Columbia Floating Rate 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 Short are associated (or correlated) with Columbia Floating. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Columbia Floating Rate has no effect on the direction of Goldman Sachs i.e., Goldman Sachs and Columbia Floating go up and down completely randomly.
Pair Corralation between Goldman Sachs and Columbia Floating
Assuming the 90 days horizon Goldman Sachs is expected to generate 2.04 times less return on investment than Columbia Floating. But when comparing it to its historical volatility, Goldman Sachs Short is 1.12 times less risky than Columbia Floating. It trades about 0.12 of its potential returns per unit of risk. Columbia Floating Rate is currently generating about 0.22 of returns per unit of risk over similar time horizon. If you would invest 2,780 in Columbia Floating Rate on September 12, 2024 and sell it today you would earn a total of 581.00 from holding Columbia Floating Rate or generate 20.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 98.18% |
| Values | Daily Returns |
Goldman Sachs Short vs. Columbia Floating Rate
Performance |
| Timeline |
| Goldman Sachs Short |
| Columbia Floating Rate |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Solid
Goldman Sachs and Columbia Floating Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Goldman Sachs and Columbia Floating
The main advantage of trading using opposite Goldman Sachs and Columbia Floating positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Goldman Sachs position performs unexpectedly, Columbia Floating 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 Columbia Floating will offset losses from the drop in Columbia Floating's long position.| Goldman Sachs vs. Blackrock Health Sciences | Goldman Sachs vs. Hartford Healthcare Hls | Goldman Sachs vs. Deutsche Health And | Goldman Sachs vs. Allianzgi Health Sciences |
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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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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