Correlation Between Goldman Sachs and Great Elm
Can any of the company-specific risk be diversified away by investing in both Goldman Sachs and Great Elm 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 Great Elm 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 Great Elm Group, you can compare the effects of market volatilities on Goldman Sachs and Great Elm 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 Great Elm. Check out your portfolio center. Please also check ongoing floating volatility patterns of Goldman Sachs and Great Elm.
Diversification Opportunities for Goldman Sachs and Great Elm
-0.56 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Goldman and Great is -0.56. Overlapping area represents the amount of risk that can be diversified away by holding Goldman Sachs Group and Great Elm Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Great Elm Group 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 Great Elm. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Great Elm Group has no effect on the direction of Goldman Sachs i.e., Goldman Sachs and Great Elm go up and down completely randomly.
Pair Corralation between Goldman Sachs and Great Elm
Allowing for the 90-day total investment horizon Goldman Sachs Group is expected to generate 1.65 times more return on investment than Great Elm. However, Goldman Sachs is 1.65 times more volatile than Great Elm Group. It trades about 0.21 of its potential returns per unit of risk. Great Elm Group is currently generating about 0.0 per unit of risk. If you would invest 51,720 in Goldman Sachs Group on August 24, 2024 and sell it today you would earn a total of 7,891 from holding Goldman Sachs Group or generate 15.26% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Goldman Sachs Group vs. Great Elm Group
Performance |
| Timeline |
| Goldman Sachs Group |
| Great Elm Group |
Goldman Sachs and Great Elm Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Goldman Sachs and Great Elm
The main advantage of trading using opposite Goldman Sachs and Great Elm positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Goldman Sachs position performs unexpectedly, Great Elm 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 Great Elm will offset losses from the drop in Great Elm's long position.| Goldman Sachs vs. JPMorgan Chase Co | Goldman Sachs vs. Wells Fargo | Goldman Sachs vs. Citigroup | Goldman Sachs vs. American Express |
| Great Elm vs. Investcorp Credit Management | Great Elm vs. Monroe Capital Corp | Great Elm vs. Allianzgi Convertible Income | Great Elm vs. John Hancock Income |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
Other Complementary Tools
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Positions Ratings 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 | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk |