Correlation Between Goldman Sachs and Seafarer Overseas
Can any of the company-specific risk be diversified away by investing in both Goldman Sachs and Seafarer Overseas 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 Seafarer Overseas into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Goldman Sachs Managed and Seafarer Overseas Growth, you can compare the effects of market volatilities on Goldman Sachs and Seafarer Overseas 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 Seafarer Overseas. Check out your portfolio center. Please also check ongoing floating volatility patterns of Goldman Sachs and Seafarer Overseas.
Diversification Opportunities for Goldman Sachs and Seafarer Overseas
0.61 | Correlation Coefficient |
Poor diversification
The 3 months correlation between GOLDMAN and Seafarer is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding Goldman Sachs Managed and Seafarer Overseas Growth in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Seafarer Overseas 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 Managed are associated (or correlated) with Seafarer Overseas. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Seafarer Overseas Growth has no effect on the direction of Goldman Sachs i.e., Goldman Sachs and Seafarer Overseas go up and down completely randomly.
Pair Corralation between Goldman Sachs and Seafarer Overseas
Assuming the 90 days horizon Goldman Sachs Managed is expected to generate 0.75 times more return on investment than Seafarer Overseas. However, Goldman Sachs Managed is 1.34 times less risky than Seafarer Overseas. It trades about 0.22 of its potential returns per unit of risk. Seafarer Overseas Growth is currently generating about -0.1 per unit of risk. If you would invest 908.00 in Goldman Sachs Managed on September 4, 2024 and sell it today you would earn a total of 22.00 from holding Goldman Sachs Managed or generate 2.42% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Goldman Sachs Managed vs. Seafarer Overseas Growth
Performance |
| Timeline |
| Goldman Sachs Managed |
| Seafarer Overseas Growth |
Goldman Sachs and Seafarer Overseas Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Goldman Sachs and Seafarer Overseas
The main advantage of trading using opposite Goldman Sachs and Seafarer Overseas positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Goldman Sachs position performs unexpectedly, Seafarer Overseas 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 Seafarer Overseas will offset losses from the drop in Seafarer Overseas' 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 |
| Seafarer Overseas vs. Gamco Global Gold | Seafarer Overseas vs. Precious Metals And | Seafarer Overseas vs. Sprott Gold Equity | Seafarer Overseas vs. Franklin Gold Precious |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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