Correlation Between Growth Opportunities and Goldman Sachs
Can any of the company-specific risk be diversified away by investing in both Growth Opportunities 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 Growth Opportunities and Goldman Sachs into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Growth Opportunities Fund and Goldman Sachs Inflation, you can compare the effects of market volatilities on Growth Opportunities 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 Growth Opportunities with a short position of Goldman Sachs. Check out your portfolio center. Please also check ongoing floating volatility patterns of Growth Opportunities and Goldman Sachs.
Diversification Opportunities for Growth Opportunities and Goldman Sachs
-0.67 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between GROWTH and Goldman is -0.67. Overlapping area represents the amount of risk that can be diversified away by holding Growth Opportunities Fund and Goldman Sachs Inflation in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Goldman Sachs Inflation and Growth Opportunities 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 Growth Opportunities Fund 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 Inflation has no effect on the direction of Growth Opportunities i.e., Growth Opportunities and Goldman Sachs go up and down completely randomly.
Pair Corralation between Growth Opportunities and Goldman Sachs
Assuming the 90 days horizon Growth Opportunities Fund is expected to generate 3.04 times more return on investment than Goldman Sachs. However, Growth Opportunities is 3.04 times more volatile than Goldman Sachs Inflation. It trades about 0.34 of its potential returns per unit of risk. Goldman Sachs Inflation is currently generating about 0.08 per unit of risk. If you would invest 5,471 in Growth Opportunities Fund on September 1, 2024 and sell it today you would earn a total of 385.00 from holding Growth Opportunities Fund or generate 7.04% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Growth Opportunities Fund vs. Goldman Sachs Inflation
Performance |
| Timeline |
| Growth Opportunities |
| Goldman Sachs Inflation |
Growth Opportunities and Goldman Sachs Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Growth Opportunities and Goldman Sachs
The main advantage of trading using opposite Growth Opportunities and Goldman Sachs positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Growth Opportunities 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.| Growth Opportunities vs. Virtus Real Estate | Growth Opportunities vs. Prudential Real Estate | Growth Opportunities vs. Deutsche Real Estate | Growth Opportunities vs. Goldman Sachs Real |
| Goldman Sachs vs. Commonwealth Global Fund | Goldman Sachs vs. Vanguard Small Cap Growth | Goldman Sachs vs. Eic Value Fund | Goldman Sachs vs. Growth Opportunities Fund |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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