Correlation Between Goldman Sachs and Catalyst/millburn
Can any of the company-specific risk be diversified away by investing in both Goldman Sachs and Catalyst/millburn 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 Catalyst/millburn into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Goldman Sachs Real and Catalystmillburn Dynamic Commodity, you can compare the effects of market volatilities on Goldman Sachs and Catalyst/millburn 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 Catalyst/millburn. Check out your portfolio center. Please also check ongoing floating volatility patterns of Goldman Sachs and Catalyst/millburn.
Diversification Opportunities for Goldman Sachs and Catalyst/millburn
0.09 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Goldman and Catalyst/millburn is 0.09. Overlapping area represents the amount of risk that can be diversified away by holding Goldman Sachs Real and Catalystmillburn Dynamic Commo in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Catalystmillburn Dyn 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 Real are associated (or correlated) with Catalyst/millburn. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Catalystmillburn Dyn has no effect on the direction of Goldman Sachs i.e., Goldman Sachs and Catalyst/millburn go up and down completely randomly.
Pair Corralation between Goldman Sachs and Catalyst/millburn
Assuming the 90 days horizon Goldman Sachs Real is expected to generate 1.11 times more return on investment than Catalyst/millburn. However, Goldman Sachs is 1.11 times more volatile than Catalystmillburn Dynamic Commodity. It trades about 0.3 of its potential returns per unit of risk. Catalystmillburn Dynamic Commodity is currently generating about 0.01 per unit of risk. If you would invest 1,297 in Goldman Sachs Real on September 4, 2024 and sell it today you would earn a total of 71.00 from holding Goldman Sachs Real or generate 5.47% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.24% |
| Values | Daily Returns |
Goldman Sachs Real vs. Catalystmillburn Dynamic Commo
Performance |
| Timeline |
| Goldman Sachs Real |
| Catalystmillburn Dyn |
Goldman Sachs and Catalyst/millburn Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Goldman Sachs and Catalyst/millburn
The main advantage of trading using opposite Goldman Sachs and Catalyst/millburn positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Goldman Sachs position performs unexpectedly, Catalyst/millburn 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 Catalyst/millburn will offset losses from the drop in Catalyst/millburn's long position.| Goldman Sachs vs. Realty Income | Goldman Sachs vs. Dynex Capital | Goldman Sachs vs. First Industrial Realty | Goldman Sachs vs. Healthcare Realty Trust |
| Catalyst/millburn vs. Catalystsmh High Income | Catalyst/millburn vs. Catalystsmh High Income | Catalyst/millburn vs. Catalystsmh High Income | Catalyst/millburn vs. Catalyst Mlp Infrastructure |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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