Correlation Between Cref Inflation and Goldman Sachs
Can any of the company-specific risk be diversified away by investing in both Cref Inflation 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 Cref Inflation and Goldman Sachs into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cref Inflation Linked Bond and Goldman Sachs Large, you can compare the effects of market volatilities on Cref Inflation 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 Cref Inflation with a short position of Goldman Sachs. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cref Inflation and Goldman Sachs.
Diversification Opportunities for Cref Inflation and Goldman Sachs
-0.48 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Cref and Goldman is -0.48. Overlapping area represents the amount of risk that can be diversified away by holding Cref Inflation Linked Bond and Goldman Sachs Large in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Goldman Sachs Large and Cref Inflation 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 Cref Inflation Linked Bond 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 Large has no effect on the direction of Cref Inflation i.e., Cref Inflation and Goldman Sachs go up and down completely randomly.
Pair Corralation between Cref Inflation and Goldman Sachs
Assuming the 90 days trading horizon Cref Inflation is expected to generate 3.34 times less return on investment than Goldman Sachs. But when comparing it to its historical volatility, Cref Inflation Linked Bond is 2.99 times less risky than Goldman Sachs. It trades about 0.07 of its potential returns per unit of risk. Goldman Sachs Large is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 1,393 in Goldman Sachs Large on September 12, 2024 and sell it today you would earn a total of 442.00 from holding Goldman Sachs Large or generate 31.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cref Inflation Linked Bond vs. Goldman Sachs Large
Performance |
| Timeline |
| Cref Inflation Linked |
| Goldman Sachs Large |
Cref Inflation and Goldman Sachs Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cref Inflation and Goldman Sachs
The main advantage of trading using opposite Cref Inflation and Goldman Sachs positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cref Inflation 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.| Cref Inflation vs. Queens Road Small | Cref Inflation vs. Boston Partners Small | Cref Inflation vs. Valic Company I | Cref Inflation vs. Fpa Queens Road |
| Goldman Sachs vs. T Rowe Price | Goldman Sachs vs. Siit High Yield | Goldman Sachs vs. Pax High Yield | Goldman Sachs vs. Strategic Advisers 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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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