Correlation Between Goldman Sachs and ETRADE Financial
Can any of the company-specific risk be diversified away by investing in both Goldman Sachs and ETRADE Financial 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 ETRADE Financial 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 ETRADE Financial LLC, you can compare the effects of market volatilities on Goldman Sachs and ETRADE Financial 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 ETRADE Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Goldman Sachs and ETRADE Financial.
Diversification Opportunities for Goldman Sachs and ETRADE Financial
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Goldman and ETRADE is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Goldman Sachs Group and ETRADE Financial LLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ETRADE Financial LLC 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 ETRADE Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ETRADE Financial LLC has no effect on the direction of Goldman Sachs i.e., Goldman Sachs and ETRADE Financial go up and down completely randomly.
Pair Corralation between Goldman Sachs and ETRADE Financial
If you would invest 34,609 in Goldman Sachs Group on October 23, 2024 and sell it today you would earn a total of 27,985 from holding Goldman Sachs Group or generate 80.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
Goldman Sachs Group vs. ETRADE Financial LLC
Performance |
| Timeline |
| Goldman Sachs Group |
| ETRADE Financial LLC |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Goldman Sachs and ETRADE Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Goldman Sachs and ETRADE Financial
The main advantage of trading using opposite Goldman Sachs and ETRADE Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Goldman Sachs position performs unexpectedly, ETRADE Financial 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 ETRADE Financial will offset losses from the drop in ETRADE Financial's long position.| Goldman Sachs vs. Morgan Stanley | Goldman Sachs vs. JPMorgan Chase Co | Goldman Sachs vs. Wells Fargo | Goldman Sachs vs. Citigroup |
| ETRADE Financial vs. Park Electrochemical | ETRADE Financial vs. AMCON Distributing | ETRADE Financial vs. Highway Holdings Limited | ETRADE Financial vs. EastGroup Properties |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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