Correlation Between Goldman Sachs and Gnma Fund
Can any of the company-specific risk be diversified away by investing in both Goldman Sachs and Gnma Fund 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 Gnma Fund into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Goldman Sachs Balanced and Gnma Fund A, you can compare the effects of market volatilities on Goldman Sachs and Gnma Fund 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 Gnma Fund. Check out your portfolio center. Please also check ongoing floating volatility patterns of Goldman Sachs and Gnma Fund.
Diversification Opportunities for Goldman Sachs and Gnma Fund
0.1 | Correlation Coefficient |
Average diversification
The 3 months correlation between Goldman and Gnma is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding Goldman Sachs Balanced and Gnma Fund A in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gnma Fund A 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 Balanced are associated (or correlated) with Gnma Fund. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gnma Fund A has no effect on the direction of Goldman Sachs i.e., Goldman Sachs and Gnma Fund go up and down completely randomly.
Pair Corralation between Goldman Sachs and Gnma Fund
Assuming the 90 days horizon Goldman Sachs Balanced is expected to generate 1.02 times more return on investment than Gnma Fund. However, Goldman Sachs is 1.02 times more volatile than Gnma Fund A. It trades about 0.34 of its potential returns per unit of risk. Gnma Fund A is currently generating about 0.14 per unit of risk. If you would invest 1,223 in Goldman Sachs Balanced on September 1, 2024 and sell it today you would earn a total of 32.00 from holding Goldman Sachs Balanced or generate 2.62% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Goldman Sachs Balanced vs. Gnma Fund A
Performance |
| Timeline |
| Goldman Sachs Balanced |
| Gnma Fund A |
Goldman Sachs and Gnma Fund Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Goldman Sachs and Gnma Fund
The main advantage of trading using opposite Goldman Sachs and Gnma Fund positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Goldman Sachs position performs unexpectedly, Gnma Fund 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 Gnma Fund will offset losses from the drop in Gnma Fund'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 |
| Gnma Fund vs. Pimco Rae Worldwide | Gnma Fund vs. Pimco Rae Worldwide | Gnma Fund vs. Pimco Rae Worldwide | Gnma Fund vs. Pimco Rae Worldwide |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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