Correlation Between Goldman Sachs and Nuveen Preferred
Can any of the company-specific risk be diversified away by investing in both Goldman Sachs and Nuveen Preferred 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 Nuveen Preferred 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 Nuveen Preferred Securities, you can compare the effects of market volatilities on Goldman Sachs and Nuveen Preferred 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 Nuveen Preferred. Check out your portfolio center. Please also check ongoing floating volatility patterns of Goldman Sachs and Nuveen Preferred.
Diversification Opportunities for Goldman Sachs and Nuveen Preferred
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Goldman and Nuveen is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Goldman Sachs Short Term and Nuveen Preferred Securities in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nuveen Preferred Sec 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 Nuveen Preferred. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nuveen Preferred Sec has no effect on the direction of Goldman Sachs i.e., Goldman Sachs and Nuveen Preferred go up and down completely randomly.
Pair Corralation between Goldman Sachs and Nuveen Preferred
If you would invest 1,558 in Nuveen Preferred Securities on September 3, 2024 and sell it today you would earn a total of 6.00 from holding Nuveen Preferred Securities or generate 0.39% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Goldman Sachs Short Term vs. Nuveen Preferred Securities
Performance |
| Timeline |
| Goldman Sachs Short |
| Nuveen Preferred Sec |
Goldman Sachs and Nuveen Preferred Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Goldman Sachs and Nuveen Preferred
The main advantage of trading using opposite Goldman Sachs and Nuveen Preferred positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Goldman Sachs position performs unexpectedly, Nuveen Preferred 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 Nuveen Preferred will offset losses from the drop in Nuveen Preferred's long position.| Goldman Sachs vs. Schwab Treasury Money | Goldman Sachs vs. Dws Government Money | Goldman Sachs vs. Lord Abbett Emerging | Goldman Sachs vs. Wt Mutual Fund |
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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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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