Correlation Between Strategic Advisers and Goldman Sachs
Can any of the company-specific risk be diversified away by investing in both Strategic Advisers 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 Strategic Advisers and Goldman Sachs into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Strategic Advisers Small Mid and Goldman Sachs Large, you can compare the effects of market volatilities on Strategic Advisers 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 Strategic Advisers with a short position of Goldman Sachs. Check out your portfolio center. Please also check ongoing floating volatility patterns of Strategic Advisers and Goldman Sachs.
Diversification Opportunities for Strategic Advisers and Goldman Sachs
0.78 | Correlation Coefficient |
Poor diversification
The 3 months correlation between STRATEGIC and Goldman is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding Strategic Advisers Small Mid 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 Strategic Advisers 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 Strategic Advisers Small Mid 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 Strategic Advisers i.e., Strategic Advisers and Goldman Sachs go up and down completely randomly.
Pair Corralation between Strategic Advisers and Goldman Sachs
Assuming the 90 days horizon Strategic Advisers Small Mid is expected to generate 0.87 times more return on investment than Goldman Sachs. However, Strategic Advisers Small Mid is 1.15 times less risky than Goldman Sachs. It trades about 0.1 of its potential returns per unit of risk. Goldman Sachs Large is currently generating about 0.03 per unit of risk. If you would invest 1,784 in Strategic Advisers Small Mid on March 27, 2025 and sell it today you would earn a total of 160.00 from holding Strategic Advisers Small Mid or generate 8.97% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 98.39% |
| Values | Daily Returns |
Strategic Advisers Small Mid vs. Goldman Sachs Large
Performance |
| Timeline |
| Strategic Advisers |
| Goldman Sachs Large |
Strategic Advisers and Goldman Sachs Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Strategic Advisers and Goldman Sachs
The main advantage of trading using opposite Strategic Advisers and Goldman Sachs positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Strategic Advisers 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.The idea behind Strategic Advisers Small Mid and Goldman Sachs Large 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.| Goldman Sachs vs. Neuberger Berman Income | Goldman Sachs vs. Columbia High Yield | Goldman Sachs vs. Strategic Advisers Income | Goldman Sachs vs. Voya High Yield |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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