Correlation Between Goldman Sachs and Mfs Lifetime
Can any of the company-specific risk be diversified away by investing in both Goldman Sachs and Mfs Lifetime 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 Mfs Lifetime 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 Mfs Lifetime 2065, you can compare the effects of market volatilities on Goldman Sachs and Mfs Lifetime 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 Mfs Lifetime. Check out your portfolio center. Please also check ongoing floating volatility patterns of Goldman Sachs and Mfs Lifetime.
Diversification Opportunities for Goldman Sachs and Mfs Lifetime
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between GOLDMAN and Mfs is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Goldman Sachs Technology and Mfs Lifetime 2065 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mfs Lifetime 2065 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 Mfs Lifetime. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mfs Lifetime 2065 has no effect on the direction of Goldman Sachs i.e., Goldman Sachs and Mfs Lifetime go up and down completely randomly.
Pair Corralation between Goldman Sachs and Mfs Lifetime
Assuming the 90 days horizon Goldman Sachs Technology is expected to generate 1.96 times more return on investment than Mfs Lifetime. However, Goldman Sachs is 1.96 times more volatile than Mfs Lifetime 2065. It trades about 0.09 of its potential returns per unit of risk. Mfs Lifetime 2065 is currently generating about 0.1 per unit of risk. If you would invest 2,497 in Goldman Sachs Technology on August 31, 2024 and sell it today you would earn a total of 374.00 from holding Goldman Sachs Technology or generate 14.98% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Goldman Sachs Technology vs. Mfs Lifetime 2065
Performance |
| Timeline |
| Goldman Sachs Technology |
| Mfs Lifetime 2065 |
Goldman Sachs and Mfs Lifetime Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Goldman Sachs and Mfs Lifetime
The main advantage of trading using opposite Goldman Sachs and Mfs Lifetime positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Goldman Sachs position performs unexpectedly, Mfs Lifetime 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 Mfs Lifetime will offset losses from the drop in Mfs Lifetime's long position.| Goldman Sachs vs. Fidelity Advisor Health | Goldman Sachs vs. Fidelity Advisor Financial | Goldman Sachs vs. Fidelity Advisor Energy | Goldman Sachs vs. Fidelity Advisor Semiconductors |
| Mfs Lifetime vs. Goldman Sachs Technology | Mfs Lifetime vs. Towpath Technology | Mfs Lifetime vs. Technology Ultrasector Profund | Mfs Lifetime vs. Biotechnology Fund Class |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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