Correlation Between Goldman Sachs and Corporate Bond
Can any of the company-specific risk be diversified away by investing in both Goldman Sachs and Corporate Bond 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 Corporate Bond 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 Corporate Bond Portfolio, you can compare the effects of market volatilities on Goldman Sachs and Corporate Bond 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 Corporate Bond. Check out your portfolio center. Please also check ongoing floating volatility patterns of Goldman Sachs and Corporate Bond.
Diversification Opportunities for Goldman Sachs and Corporate Bond
0.9 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between GOLDMAN and Corporate is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding Goldman Sachs Short and Corporate Bond Portfolio in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Corporate Bond Portfolio 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 Corporate Bond. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Corporate Bond Portfolio has no effect on the direction of Goldman Sachs i.e., Goldman Sachs and Corporate Bond go up and down completely randomly.
Pair Corralation between Goldman Sachs and Corporate Bond
Assuming the 90 days horizon Goldman Sachs Short is expected to generate 0.33 times more return on investment than Corporate Bond. However, Goldman Sachs Short is 2.99 times less risky than Corporate Bond. It trades about 0.03 of its potential returns per unit of risk. Corporate Bond Portfolio is currently generating about -0.01 per unit of risk. If you would invest 968.00 in Goldman Sachs Short on September 3, 2024 and sell it today you would earn a total of 2.00 from holding Goldman Sachs Short or generate 0.21% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Goldman Sachs Short vs. Corporate Bond Portfolio
Performance |
| Timeline |
| Goldman Sachs Short |
| Corporate Bond Portfolio |
Goldman Sachs and Corporate Bond Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Goldman Sachs and Corporate Bond
The main advantage of trading using opposite Goldman Sachs and Corporate Bond positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Goldman Sachs position performs unexpectedly, Corporate Bond 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 Corporate Bond will offset losses from the drop in Corporate Bond's long position.| Goldman Sachs vs. SPACE | Goldman Sachs vs. Bayview Acquisition Corp | Goldman Sachs vs. Ampleforth | Goldman Sachs vs. ionet |
| Corporate Bond vs. Barings Active Short | Corporate Bond vs. Goldman Sachs Short | Corporate Bond vs. Astor Longshort Fund | Corporate Bond 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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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