Correlation Between Goldman Sachs and Matthews Asian
Can any of the company-specific risk be diversified away by investing in both Goldman Sachs and Matthews Asian 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 Matthews Asian 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 Matthews Asian Growth, you can compare the effects of market volatilities on Goldman Sachs and Matthews Asian 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 Matthews Asian. Check out your portfolio center. Please also check ongoing floating volatility patterns of Goldman Sachs and Matthews Asian.
Diversification Opportunities for Goldman Sachs and Matthews Asian
0.19 | Correlation Coefficient |
Average diversification
The 3 months correlation between GOLDMAN and Matthews is 0.19. Overlapping area represents the amount of risk that can be diversified away by holding Goldman Sachs Technology and Matthews Asian Growth in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Matthews Asian Growth 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 Matthews Asian. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Matthews Asian Growth has no effect on the direction of Goldman Sachs i.e., Goldman Sachs and Matthews Asian go up and down completely randomly.
Pair Corralation between Goldman Sachs and Matthews Asian
Assuming the 90 days horizon Goldman Sachs Technology is expected to generate 1.33 times more return on investment than Matthews Asian. However, Goldman Sachs is 1.33 times more volatile than Matthews Asian Growth. It trades about 0.25 of its potential returns per unit of risk. Matthews Asian Growth is currently generating about -0.13 per unit of risk. If you would invest 2,721 in Goldman Sachs Technology on September 2, 2024 and sell it today you would earn a total of 150.00 from holding Goldman Sachs Technology or generate 5.51% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Goldman Sachs Technology vs. Matthews Asian Growth
Performance |
| Timeline |
| Goldman Sachs Technology |
| Matthews Asian Growth |
Goldman Sachs and Matthews Asian Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Goldman Sachs and Matthews Asian
The main advantage of trading using opposite Goldman Sachs and Matthews Asian positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Goldman Sachs position performs unexpectedly, Matthews Asian 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 Matthews Asian will offset losses from the drop in Matthews Asian's long position.| Goldman Sachs vs. Veea Inc | Goldman Sachs vs. VHAI | Goldman Sachs vs. VivoPower International PLC | Goldman Sachs vs. WEBTOON Entertainment Common |
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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 File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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