Correlation Between Highland Long/short and Goldman Sachs
Can any of the company-specific risk be diversified away by investing in both Highland Long/short and Goldman Sachs 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 Highland Long/short and Goldman Sachs into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Highland Longshort Healthcare and Goldman Sachs Global, you can compare the effects of market volatilities on Highland Long/short and Goldman Sachs 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 Highland Long/short with a short position of Goldman Sachs. Check out your portfolio center. Please also check ongoing floating volatility patterns of Highland Long/short and Goldman Sachs.
Diversification Opportunities for Highland Long/short and Goldman Sachs
-0.74 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Highland and Goldman is -0.74. Overlapping area represents the amount of risk that can be diversified away by holding Highland Longshort Healthcare and Goldman Sachs Global in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Goldman Sachs Global and Highland Long/short 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 Highland Longshort Healthcare are associated (or correlated) with Goldman Sachs. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Goldman Sachs Global has no effect on the direction of Highland Long/short i.e., Highland Long/short and Goldman Sachs go up and down completely randomly.
Pair Corralation between Highland Long/short and Goldman Sachs
Assuming the 90 days horizon Highland Long/short is expected to generate 1.28 times less return on investment than Goldman Sachs. But when comparing it to its historical volatility, Highland Longshort Healthcare is 1.3 times less risky than Goldman Sachs. It trades about 0.12 of its potential returns per unit of risk. Goldman Sachs Global is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 1,104 in Goldman Sachs Global on September 3, 2024 and sell it today you would earn a total of 55.00 from holding Goldman Sachs Global or generate 4.98% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Highland Longshort Healthcare vs. Goldman Sachs Global
Performance |
| Timeline |
| Highland Long/short |
| Goldman Sachs Global |
Highland Long/short and Goldman Sachs Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Highland Long/short and Goldman Sachs
The main advantage of trading using opposite Highland Long/short and Goldman Sachs positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Highland Long/short position performs unexpectedly, Goldman Sachs 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 Goldman Sachs will offset losses from the drop in Goldman Sachs' long position.| Highland Long/short vs. Ab Value Fund | Highland Long/short vs. Balanced Fund Investor | Highland Long/short vs. Rbb Fund | Highland Long/short vs. Omni Small Cap Value |
| Goldman Sachs vs. James Balanced Golden | Goldman Sachs vs. Precious Metals And | Goldman Sachs vs. Gabelli Gold Fund | Goldman Sachs vs. Fidelity Advisor Gold |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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