Correlation Between Goldman Sachs and Amg Cap
Can any of the company-specific risk be diversified away by investing in both Goldman Sachs and Amg Cap 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 Amg Cap into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Goldman Sachs Group and Amg Cap Tr, you can compare the effects of market volatilities on Goldman Sachs and Amg Cap 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 Amg Cap. Check out your portfolio center. Please also check ongoing floating volatility patterns of Goldman Sachs and Amg Cap.
Diversification Opportunities for Goldman Sachs and Amg Cap
0.36 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Goldman and Amg is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding Goldman Sachs Group and Amg Cap Tr in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amg Cap Tr 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 Group are associated (or correlated) with Amg Cap. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amg Cap Tr has no effect on the direction of Goldman Sachs i.e., Goldman Sachs and Amg Cap go up and down completely randomly.
Pair Corralation between Goldman Sachs and Amg Cap
Allowing for the 90-day total investment horizon Goldman Sachs is expected to generate 1.35 times less return on investment than Amg Cap. But when comparing it to its historical volatility, Goldman Sachs Group is 3.17 times less risky than Amg Cap. It trades about 0.08 of its potential returns per unit of risk. Amg Cap Tr is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 4,601 in Amg Cap Tr on August 30, 2024 and sell it today you would earn a total of 946.00 from holding Amg Cap Tr or generate 20.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 83.84% |
| Values | Daily Returns |
Goldman Sachs Group vs. Amg Cap Tr
Performance |
| Timeline |
| Goldman Sachs Group |
| Amg Cap Tr |
Goldman Sachs and Amg Cap Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Goldman Sachs and Amg Cap
The main advantage of trading using opposite Goldman Sachs and Amg Cap positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Goldman Sachs position performs unexpectedly, Amg Cap 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 Amg Cap will offset losses from the drop in Amg Cap's long position.| Goldman Sachs vs. Morgan Stanley | Goldman Sachs vs. JPMorgan Chase Co | Goldman Sachs vs. Wells Fargo | Goldman Sachs vs. Citigroup |
| Amg Cap vs. Ameren Illinois | Amg Cap vs. AGNC Investment Corp | Amg Cap vs. AGNC Investment Corp | Amg Cap vs. BFC Capital Trust |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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