Correlation Between Goldman Sachs and Hartford Multifactor
Can any of the company-specific risk be diversified away by investing in both Goldman Sachs and Hartford Multifactor 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 Hartford Multifactor into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Goldman Sachs ActiveBeta and Hartford Multifactor Equity, you can compare the effects of market volatilities on Goldman Sachs and Hartford Multifactor 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 Hartford Multifactor. Check out your portfolio center. Please also check ongoing floating volatility patterns of Goldman Sachs and Hartford Multifactor.
Diversification Opportunities for Goldman Sachs and Hartford Multifactor
0.81 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Goldman and Hartford is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding Goldman Sachs ActiveBeta and Hartford Multifactor Equity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hartford Multifactor 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 ActiveBeta are associated (or correlated) with Hartford Multifactor. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hartford Multifactor has no effect on the direction of Goldman Sachs i.e., Goldman Sachs and Hartford Multifactor go up and down completely randomly.
Pair Corralation between Goldman Sachs and Hartford Multifactor
Given the investment horizon of 90 days Goldman Sachs ActiveBeta is expected to generate 1.14 times more return on investment than Hartford Multifactor. However, Goldman Sachs is 1.14 times more volatile than Hartford Multifactor Equity. It trades about 0.26 of its potential returns per unit of risk. Hartford Multifactor Equity is currently generating about 0.0 per unit of risk. If you would invest 3,470 in Goldman Sachs ActiveBeta on November 29, 2024 and sell it today you would earn a total of 127.00 from holding Goldman Sachs ActiveBeta or generate 3.66% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Goldman Sachs ActiveBeta vs. Hartford Multifactor Equity
Performance |
| Timeline |
| Goldman Sachs ActiveBeta |
| Hartford Multifactor |
Goldman Sachs and Hartford Multifactor Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Goldman Sachs and Hartford Multifactor
The main advantage of trading using opposite Goldman Sachs and Hartford Multifactor positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Goldman Sachs position performs unexpectedly, Hartford Multifactor 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 Hartford Multifactor will offset losses from the drop in Hartford Multifactor's long position.| Goldman Sachs vs. Strategy Shares | Goldman Sachs vs. Freedom Day Dividend | Goldman Sachs vs. Franklin Templeton ETF | Goldman Sachs vs. iShares MSCI China |
| Hartford Multifactor vs. Hartford Multifactor Emerging | Hartford Multifactor vs. Hartford Multifactor Developed | Hartford Multifactor vs. iShares Equity Factor | Hartford Multifactor vs. SPDR MSCI USA |
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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