Correlation Between Consumer Portfolio and Goldman Sachs
Can any of the company-specific risk be diversified away by investing in both Consumer Portfolio 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 Consumer Portfolio and Goldman Sachs into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Consumer Portfolio Services and Goldman Sachs Clean, you can compare the effects of market volatilities on Consumer Portfolio 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 Consumer Portfolio with a short position of Goldman Sachs. Check out your portfolio center. Please also check ongoing floating volatility patterns of Consumer Portfolio and Goldman Sachs.
Diversification Opportunities for Consumer Portfolio and Goldman Sachs
0.78 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Consumer and Goldman is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding Consumer Portfolio Services and Goldman Sachs Clean in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Goldman Sachs Clean and Consumer Portfolio 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 Consumer Portfolio Services 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 Clean has no effect on the direction of Consumer Portfolio i.e., Consumer Portfolio and Goldman Sachs go up and down completely randomly.
Pair Corralation between Consumer Portfolio and Goldman Sachs
Given the investment horizon of 90 days Consumer Portfolio Services is expected to generate 2.92 times more return on investment than Goldman Sachs. However, Consumer Portfolio is 2.92 times more volatile than Goldman Sachs Clean. It trades about 0.08 of its potential returns per unit of risk. Goldman Sachs Clean is currently generating about 0.23 per unit of risk. If you would invest 809.00 in Consumer Portfolio Services on April 21, 2025 and sell it today you would earn a total of 98.00 from holding Consumer Portfolio Services or generate 12.11% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
Consumer Portfolio Services vs. Goldman Sachs Clean
Performance |
Timeline |
Consumer Portfolio |
Goldman Sachs Clean |
Consumer Portfolio and Goldman Sachs Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Consumer Portfolio and Goldman Sachs
The main advantage of trading using opposite Consumer Portfolio and Goldman Sachs positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Consumer Portfolio 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.Consumer Portfolio vs. Regional Management Corp | Consumer Portfolio vs. Orix Corp Ads | Consumer Portfolio vs. FirstCash | Consumer Portfolio vs. Finance of America |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
Other Complementary Tools
Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
Global Correlations Find global opportunities by holding instruments from different markets | |
Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
Content Syndication Quickly integrate customizable finance content to your own investment portal | |
Economic Indicators Top statistical indicators that provide insights into how an economy is performing |