Correlation Between GOLDMAN and Lincoln Electric
Specify exactly 2 symbols:
By analyzing existing cross correlation between GOLDMAN SACHS GROUP and Lincoln Electric Holdings, you can compare the effects of market volatilities on GOLDMAN and Lincoln Electric 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 with a short position of Lincoln Electric. Check out your portfolio center. Please also check ongoing floating volatility patterns of GOLDMAN and Lincoln Electric.
Diversification Opportunities for GOLDMAN and Lincoln Electric
-0.07 | Correlation Coefficient |
Good diversification
The 3 months correlation between GOLDMAN and Lincoln is -0.07. Overlapping area represents the amount of risk that can be diversified away by holding GOLDMAN SACHS GROUP and Lincoln Electric Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lincoln Electric Holdings and GOLDMAN 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 GROUP are associated (or correlated) with Lincoln Electric. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lincoln Electric Holdings has no effect on the direction of GOLDMAN i.e., GOLDMAN and Lincoln Electric go up and down completely randomly.
Pair Corralation between GOLDMAN and Lincoln Electric
Assuming the 90 days trading horizon GOLDMAN SACHS GROUP is expected to under-perform the Lincoln Electric. But the bond apears to be less risky and, when comparing its historical volatility, GOLDMAN SACHS GROUP is 2.88 times less risky than Lincoln Electric. The bond trades about -0.11 of its potential returns per unit of risk. The Lincoln Electric Holdings is currently generating about 0.22 of returns per unit of risk over similar time horizon. If you would invest 19,880 in Lincoln Electric Holdings on September 3, 2024 and sell it today you would earn a total of 1,968 from holding Lincoln Electric Holdings or generate 9.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 65.0% |
| Values | Daily Returns |
GOLDMAN SACHS GROUP vs. Lincoln Electric Holdings
Performance |
| Timeline |
| GOLDMAN SACHS GROUP |
| Lincoln Electric Holdings |
GOLDMAN and Lincoln Electric Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GOLDMAN and Lincoln Electric
The main advantage of trading using opposite GOLDMAN and Lincoln Electric positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GOLDMAN position performs unexpectedly, Lincoln Electric 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 Lincoln Electric will offset losses from the drop in Lincoln Electric's long position.The idea behind GOLDMAN SACHS GROUP and Lincoln Electric Holdings pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Lincoln Electric vs. Kennametal | Lincoln Electric vs. Toro Co | Lincoln Electric vs. Snap On | Lincoln Electric vs. Timken Company |
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 Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
Other Complementary Tools
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk | |
| Stocks Directory Find actively traded stocks across global markets |