Correlation Between Goldman Sachs and Astor Long/short
Can any of the company-specific risk be diversified away by investing in both Goldman Sachs and Astor Long/short 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 Astor Long/short into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Goldman Sachs Short Term and Astor Longshort Fund, you can compare the effects of market volatilities on Goldman Sachs and Astor Long/short 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 Astor Long/short. Check out your portfolio center. Please also check ongoing floating volatility patterns of Goldman Sachs and Astor Long/short.
Diversification Opportunities for Goldman Sachs and Astor Long/short
0.8 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between GOLDMAN and Astor is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding Goldman Sachs Short Term and Astor Longshort Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Astor Long/short 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 Short Term are associated (or correlated) with Astor Long/short. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Astor Long/short has no effect on the direction of Goldman Sachs i.e., Goldman Sachs and Astor Long/short go up and down completely randomly.
Pair Corralation between Goldman Sachs and Astor Long/short
Assuming the 90 days horizon Goldman Sachs is expected to generate 1.75 times less return on investment than Astor Long/short. But when comparing it to its historical volatility, Goldman Sachs Short Term is 3.66 times less risky than Astor Long/short. It trades about 0.22 of its potential returns per unit of risk. Astor Longshort Fund is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 1,187 in Astor Longshort Fund on September 2, 2024 and sell it today you would earn a total of 244.00 from holding Astor Longshort Fund or generate 20.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Goldman Sachs Short Term vs. Astor Longshort Fund
Performance |
| Timeline |
| Goldman Sachs Short |
| Astor Long/short |
Goldman Sachs and Astor Long/short Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Goldman Sachs and Astor Long/short
The main advantage of trading using opposite Goldman Sachs and Astor Long/short positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Goldman Sachs position performs unexpectedly, Astor Long/short 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 Astor Long/short will offset losses from the drop in Astor Long/short's 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 |
| Astor Long/short vs. Fidelity Series Government | Astor Long/short vs. Government Securities Fund | Astor Long/short vs. Dws Government Money | Astor Long/short vs. Dreyfus Government Cash |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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