Correlation Between Goldman Sachs and Specialized Technology
Can any of the company-specific risk be diversified away by investing in both Goldman Sachs and Specialized Technology 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 Specialized Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Goldman Sachs Inflation and Specialized Technology Fund, you can compare the effects of market volatilities on Goldman Sachs and Specialized Technology 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 Specialized Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Goldman Sachs and Specialized Technology.
Diversification Opportunities for Goldman Sachs and Specialized Technology
-0.49 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Goldman and Specialized is -0.49. Overlapping area represents the amount of risk that can be diversified away by holding Goldman Sachs Inflation and Specialized Technology Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Specialized Technology 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 Inflation are associated (or correlated) with Specialized Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Specialized Technology has no effect on the direction of Goldman Sachs i.e., Goldman Sachs and Specialized Technology go up and down completely randomly.
Pair Corralation between Goldman Sachs and Specialized Technology
Assuming the 90 days horizon Goldman Sachs Inflation is expected to generate 0.12 times more return on investment than Specialized Technology. However, Goldman Sachs Inflation is 8.53 times less risky than Specialized Technology. It trades about 0.09 of its potential returns per unit of risk. Specialized Technology Fund is currently generating about -0.13 per unit of risk. If you would invest 949.00 in Goldman Sachs Inflation on September 17, 2024 and sell it today you would earn a total of 4.00 from holding Goldman Sachs Inflation or generate 0.42% 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 Inflation vs. Specialized Technology Fund
Performance |
| Timeline |
| Goldman Sachs Inflation |
| Specialized Technology |
Goldman Sachs and Specialized Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Goldman Sachs and Specialized Technology
The main advantage of trading using opposite Goldman Sachs and Specialized Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Goldman Sachs position performs unexpectedly, Specialized Technology 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 Specialized Technology will offset losses from the drop in Specialized Technology'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 |
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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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