Correlation Between Goldman Sachs and USCF Gold
Can any of the company-specific risk be diversified away by investing in both Goldman Sachs and USCF Gold 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 USCF Gold into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Goldman Sachs Access and USCF Gold Strategy, you can compare the effects of market volatilities on Goldman Sachs and USCF Gold 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 USCF Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of Goldman Sachs and USCF Gold.
Diversification Opportunities for Goldman Sachs and USCF Gold
0.63 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Goldman and USCF is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding Goldman Sachs Access and USCF Gold Strategy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on USCF Gold Strategy 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 Access are associated (or correlated) with USCF Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of USCF Gold Strategy has no effect on the direction of Goldman Sachs i.e., Goldman Sachs and USCF Gold go up and down completely randomly.
Pair Corralation between Goldman Sachs and USCF Gold
Given the investment horizon of 90 days Goldman Sachs Access is expected to generate 0.03 times more return on investment than USCF Gold. However, Goldman Sachs Access is 33.76 times less risky than USCF Gold. It trades about 0.55 of its potential returns per unit of risk. USCF Gold Strategy is currently generating about -0.11 per unit of risk. If you would invest 5,023 in Goldman Sachs Access on September 1, 2024 and sell it today you would earn a total of 23.00 from holding Goldman Sachs Access or generate 0.46% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Goldman Sachs Access vs. USCF Gold Strategy
Performance |
| Timeline |
| Goldman Sachs Access |
| USCF Gold Strategy |
Goldman Sachs and USCF Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Goldman Sachs and USCF Gold
The main advantage of trading using opposite Goldman Sachs and USCF Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Goldman Sachs position performs unexpectedly, USCF Gold 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 USCF Gold will offset losses from the drop in USCF Gold's long position.| Goldman Sachs vs. Janus Henderson Mortgage Backed | Goldman Sachs vs. Goldman Sachs Access | Goldman Sachs vs. JPMorgan Ultra Short Municipal | Goldman Sachs vs. Goldman Sachs Access |
| USCF Gold vs. VictoryShares Small Cap | USCF Gold vs. SPDR Gold Shares | USCF Gold vs. First Trust Equity | USCF Gold vs. SPDR Nuveen Municipal |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
Other Complementary Tools
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| Global Correlations Find global opportunities by holding instruments from different markets | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets |