Correlation Between Goldman Sachs and Baillie Gifford
Can any of the company-specific risk be diversified away by investing in both Goldman Sachs and Baillie Gifford 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 Baillie Gifford into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Goldman Sachs Large and Baillie Gifford China, you can compare the effects of market volatilities on Goldman Sachs and Baillie Gifford 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 Baillie Gifford. Check out your portfolio center. Please also check ongoing floating volatility patterns of Goldman Sachs and Baillie Gifford.
Diversification Opportunities for Goldman Sachs and Baillie Gifford
0.54 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Goldman and Baillie is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding Goldman Sachs Large and Baillie Gifford China in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Baillie Gifford China 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 Large are associated (or correlated) with Baillie Gifford. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Baillie Gifford China has no effect on the direction of Goldman Sachs i.e., Goldman Sachs and Baillie Gifford go up and down completely randomly.
Pair Corralation between Goldman Sachs and Baillie Gifford
Assuming the 90 days horizon Goldman Sachs Large is expected to generate 0.6 times more return on investment than Baillie Gifford. However, Goldman Sachs Large is 1.67 times less risky than Baillie Gifford. It trades about 0.09 of its potential returns per unit of risk. Baillie Gifford China is currently generating about 0.04 per unit of risk. If you would invest 3,277 in Goldman Sachs Large on September 3, 2024 and sell it today you would earn a total of 453.00 from holding Goldman Sachs Large or generate 13.82% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Goldman Sachs Large vs. Baillie Gifford China
Performance |
| Timeline |
| Goldman Sachs Large |
| Baillie Gifford China |
Goldman Sachs and Baillie Gifford Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Goldman Sachs and Baillie Gifford
The main advantage of trading using opposite Goldman Sachs and Baillie Gifford positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Goldman Sachs position performs unexpectedly, Baillie Gifford 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 Baillie Gifford will offset losses from the drop in Baillie Gifford's long position.The idea behind Goldman Sachs Large and Baillie Gifford China pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Baillie Gifford vs. Qs Large Cap | Baillie Gifford vs. Tax Managed Large Cap | Baillie Gifford vs. Transamerica Large Cap | Baillie Gifford vs. Americafirst Large Cap |
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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
Other Complementary Tools
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios | |
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world |