Correlation Between Sit International and Goldman Sachs
Can any of the company-specific risk be diversified away by investing in both Sit International 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 Sit International and Goldman Sachs into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sit International Equity and Goldman Sachs Short, you can compare the effects of market volatilities on Sit International 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 Sit International with a short position of Goldman Sachs. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sit International and Goldman Sachs.
Diversification Opportunities for Sit International and Goldman Sachs
0.22 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Sit and Goldman is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding Sit International Equity and Goldman Sachs Short in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Goldman Sachs Short and Sit International 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 Sit International Equity 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 Short has no effect on the direction of Sit International i.e., Sit International and Goldman Sachs go up and down completely randomly.
Pair Corralation between Sit International and Goldman Sachs
Assuming the 90 days horizon Sit International Equity is expected to generate 7.4 times more return on investment than Goldman Sachs. However, Sit International is 7.4 times more volatile than Goldman Sachs Short. It trades about 0.05 of its potential returns per unit of risk. Goldman Sachs Short is currently generating about 0.15 per unit of risk. If you would invest 1,109 in Sit International Equity on August 26, 2024 and sell it today you would earn a total of 138.00 from holding Sit International Equity or generate 12.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sit International Equity vs. Goldman Sachs Short
Performance |
| Timeline |
| Sit International Equity |
| Goldman Sachs Short |
Sit International and Goldman Sachs Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sit International and Goldman Sachs
The main advantage of trading using opposite Sit International and Goldman Sachs positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sit International 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.| Sit International vs. Simt Multi Asset Accumulation | Sit International vs. Saat Market Growth | Sit International vs. Simt Real Return | Sit International vs. Simt Small Cap |
| Goldman Sachs vs. Goldman Sachs Clean | Goldman Sachs vs. Goldman Sachs Clean | Goldman Sachs vs. Goldman Sachs Clean | Goldman Sachs vs. Goldman Sachs Clean |
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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