Correlation Between Goldman Sachs and Ab International
Can any of the company-specific risk be diversified away by investing in both Goldman Sachs and Ab International 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 Ab International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Goldman Sachs Technology and Ab International Value, you can compare the effects of market volatilities on Goldman Sachs and Ab International 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 Ab International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Goldman Sachs and Ab International.
Diversification Opportunities for Goldman Sachs and Ab International
-0.65 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Goldman and ABIAX is -0.65. Overlapping area represents the amount of risk that can be diversified away by holding Goldman Sachs Technology and Ab International Value in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ab International Value 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 Technology are associated (or correlated) with Ab International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ab International Value has no effect on the direction of Goldman Sachs i.e., Goldman Sachs and Ab International go up and down completely randomly.
Pair Corralation between Goldman Sachs and Ab International
Assuming the 90 days horizon Goldman Sachs Technology is expected to generate 1.2 times more return on investment than Ab International. However, Goldman Sachs is 1.2 times more volatile than Ab International Value. It trades about 0.09 of its potential returns per unit of risk. Ab International Value is currently generating about -0.03 per unit of risk. If you would invest 2,474 in Goldman Sachs Technology on September 3, 2024 and sell it today you would earn a total of 397.00 from holding Goldman Sachs Technology or generate 16.05% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Goldman Sachs Technology vs. Ab International Value
Performance |
| Timeline |
| Goldman Sachs Technology |
| Ab International Value |
Goldman Sachs and Ab International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Goldman Sachs and Ab International
The main advantage of trading using opposite Goldman Sachs and Ab International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Goldman Sachs position performs unexpectedly, Ab International 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 Ab International will offset losses from the drop in Ab International's long position.| Goldman Sachs vs. Lind Capital Partners | Goldman Sachs vs. Franklin High Yield | Goldman Sachs vs. T Rowe Price | Goldman Sachs vs. T Rowe Price |
| Ab International vs. Oakmark International Fund | Ab International vs. Dodge International Stock | Ab International vs. Oakmark International Fund | Ab International vs. Oakmark International Fund |
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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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