Correlation Between Goldman Sachs and Cref Money
Can any of the company-specific risk be diversified away by investing in both Goldman Sachs and Cref Money 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 Cref Money into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Goldman Sachs International and Cref Money Market, you can compare the effects of market volatilities on Goldman Sachs and Cref Money 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 Cref Money. Check out your portfolio center. Please also check ongoing floating volatility patterns of Goldman Sachs and Cref Money.
Diversification Opportunities for Goldman Sachs and Cref Money
0.43 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Goldman and Cref is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding Goldman Sachs International and Cref Money Market in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cref Money Market 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 International are associated (or correlated) with Cref Money. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cref Money Market has no effect on the direction of Goldman Sachs i.e., Goldman Sachs and Cref Money go up and down completely randomly.
Pair Corralation between Goldman Sachs and Cref Money
Assuming the 90 days horizon Goldman Sachs International is expected to generate 41.57 times more return on investment than Cref Money. However, Goldman Sachs is 41.57 times more volatile than Cref Money Market. It trades about 0.26 of its potential returns per unit of risk. Cref Money Market is currently generating about 0.93 per unit of risk. If you would invest 1,255 in Goldman Sachs International on November 28, 2024 and sell it today you would earn a total of 49.00 from holding Goldman Sachs International or generate 3.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Goldman Sachs International vs. Cref Money Market
Performance |
| Timeline |
| Goldman Sachs Intern |
| Cref Money Market |
Goldman Sachs and Cref Money Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Goldman Sachs and Cref Money
The main advantage of trading using opposite Goldman Sachs and Cref Money positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Goldman Sachs position performs unexpectedly, Cref Money 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 Cref Money will offset losses from the drop in Cref Money's long position.| Goldman Sachs vs. Blackrock All Cap Energy | Goldman Sachs vs. Thrivent Natural Resources | Goldman Sachs vs. Pimco Energy Tactical | Goldman Sachs vs. Fidelity Advisor Energy |
| Cref Money vs. Dreyfusstandish Global Fixed | Cref Money vs. Barings Active Short | Cref Money vs. Baird Quality Intermediate | Cref Money vs. Gmo High Yield |
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 Stocks Directory module to find actively traded stocks across global markets.
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