Correlation Between GOLDMAN SACHS and New Found
Can any of the company-specific risk be diversified away by investing in both GOLDMAN SACHS and New Found 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 New Found into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GOLDMAN SACHS CDR and New Found Gold, you can compare the effects of market volatilities on GOLDMAN SACHS and New Found 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 New Found. Check out your portfolio center. Please also check ongoing floating volatility patterns of GOLDMAN SACHS and New Found.
Diversification Opportunities for GOLDMAN SACHS and New Found
0.16 | Correlation Coefficient |
Average diversification
The 3 months correlation between GOLDMAN and New is 0.16. Overlapping area represents the amount of risk that can be diversified away by holding GOLDMAN SACHS CDR and New Found Gold in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on New Found Gold 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 CDR are associated (or correlated) with New Found. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of New Found Gold has no effect on the direction of GOLDMAN SACHS i.e., GOLDMAN SACHS and New Found go up and down completely randomly.
Pair Corralation between GOLDMAN SACHS and New Found
Assuming the 90 days trading horizon GOLDMAN SACHS CDR is expected to under-perform the New Found. But the stock apears to be less risky and, when comparing its historical volatility, GOLDMAN SACHS CDR is 2.82 times less risky than New Found. The stock trades about -0.1 of its potential returns per unit of risk. The New Found Gold is currently generating about 0.17 of returns per unit of risk over similar time horizon. If you would invest 241.00 in New Found Gold on November 29, 2024 and sell it today you would earn a total of 33.00 from holding New Found Gold or generate 13.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
GOLDMAN SACHS CDR vs. New Found Gold
Performance |
| Timeline |
| GOLDMAN SACHS CDR |
| New Found Gold |
GOLDMAN SACHS and New Found Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GOLDMAN SACHS and New Found
The main advantage of trading using opposite GOLDMAN SACHS and New Found positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GOLDMAN SACHS position performs unexpectedly, New Found 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 New Found will offset losses from the drop in New Found's long position.| GOLDMAN SACHS vs. HOME DEPOT CDR | GOLDMAN SACHS vs. Plaza Retail REIT | GOLDMAN SACHS vs. Maple Peak Investments | GOLDMAN SACHS vs. Solid Impact Investments |
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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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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