Correlation Between Goldman Sachs and Advent Claymore
Can any of the company-specific risk be diversified away by investing in both Goldman Sachs and Advent Claymore 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 Advent Claymore 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 Advent Claymore Convertible, you can compare the effects of market volatilities on Goldman Sachs and Advent Claymore 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 Advent Claymore. Check out your portfolio center. Please also check ongoing floating volatility patterns of Goldman Sachs and Advent Claymore.
Diversification Opportunities for Goldman Sachs and Advent Claymore
-0.4 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Goldman and Advent is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding Goldman Sachs Emerging and Advent Claymore Convertible in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Advent Claymore Conv 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 Advent Claymore. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Advent Claymore Conv has no effect on the direction of Goldman Sachs i.e., Goldman Sachs and Advent Claymore go up and down completely randomly.
Pair Corralation between Goldman Sachs and Advent Claymore
Assuming the 90 days horizon Goldman Sachs is expected to generate 2.12 times less return on investment than Advent Claymore. But when comparing it to its historical volatility, Goldman Sachs Emerging is 1.19 times less risky than Advent Claymore. It trades about 0.04 of its potential returns per unit of risk. Advent Claymore Convertible is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 902.00 in Advent Claymore Convertible on September 3, 2024 and sell it today you would earn a total of 316.00 from holding Advent Claymore Convertible or generate 35.03% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Goldman Sachs Emerging vs. Advent Claymore Convertible
Performance |
| Timeline |
| Goldman Sachs Emerging |
| Advent Claymore Conv |
Goldman Sachs and Advent Claymore Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Goldman Sachs and Advent Claymore
The main advantage of trading using opposite Goldman Sachs and Advent Claymore positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Goldman Sachs position performs unexpectedly, Advent Claymore 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 Advent Claymore will offset losses from the drop in Advent Claymore's long position.| Goldman Sachs vs. Franklin Mutual Global | Goldman Sachs vs. Templeton Growth Fund | Goldman Sachs vs. Franklin Real Estate | Goldman Sachs vs. HUMANA INC |
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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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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