Correlation Between Goldman Sachs and Mainstay Moderate
Can any of the company-specific risk be diversified away by investing in both Goldman Sachs and Mainstay Moderate 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 Mainstay Moderate 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 Mainstay Moderate Growth, you can compare the effects of market volatilities on Goldman Sachs and Mainstay Moderate 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 Mainstay Moderate. Check out your portfolio center. Please also check ongoing floating volatility patterns of Goldman Sachs and Mainstay Moderate.
Diversification Opportunities for Goldman Sachs and Mainstay Moderate
-0.21 | Correlation Coefficient |
Very good diversification
The 3 months correlation between GOLDMAN and Mainstay is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding Goldman Sachs Short and Mainstay Moderate Growth in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mainstay Moderate Growth 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 Mainstay Moderate. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mainstay Moderate Growth has no effect on the direction of Goldman Sachs i.e., Goldman Sachs and Mainstay Moderate go up and down completely randomly.
Pair Corralation between Goldman Sachs and Mainstay Moderate
Assuming the 90 days horizon Goldman Sachs is expected to generate 13.71 times less return on investment than Mainstay Moderate. But when comparing it to its historical volatility, Goldman Sachs Short is 7.92 times less risky than Mainstay Moderate. It trades about 0.2 of its potential returns per unit of risk. Mainstay Moderate Growth is currently generating about 0.35 of returns per unit of risk over similar time horizon. If you would invest 1,593 in Mainstay Moderate Growth on September 4, 2024 and sell it today you would earn a total of 72.00 from holding Mainstay Moderate Growth or generate 4.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.24% |
| Values | Daily Returns |
Goldman Sachs Short vs. Mainstay Moderate Growth
Performance |
| Timeline |
| Goldman Sachs Short |
| Mainstay Moderate Growth |
Goldman Sachs and Mainstay Moderate Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Goldman Sachs and Mainstay Moderate
The main advantage of trading using opposite Goldman Sachs and Mainstay Moderate positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Goldman Sachs position performs unexpectedly, Mainstay Moderate 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 Mainstay Moderate will offset losses from the drop in Mainstay Moderate's long position.| Goldman Sachs vs. Goldman Sachs Clean | Goldman Sachs vs. Goldman Sachs Clean | Goldman Sachs vs. Goldman Sachs Clean | Goldman Sachs vs. Goldman Sachs Clean |
| Mainstay Moderate vs. James Balanced Golden | Mainstay Moderate vs. Goldman Sachs Clean | Mainstay Moderate vs. Great West Goldman Sachs | Mainstay Moderate vs. Goldman Sachs Short |
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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.
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