Correlation Between GOLDMAN SACHS and US Financial
Can any of the company-specific risk be diversified away by investing in both GOLDMAN SACHS and US Financial 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 GOLDMAN SACHS and US Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GOLDMAN SACHS CDR and US Financial 15, you can compare the effects of market volatilities on GOLDMAN SACHS and US Financial 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 SACHS with a short position of US Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of GOLDMAN SACHS and US Financial.
Diversification Opportunities for GOLDMAN SACHS and US Financial
0.95 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between GOLDMAN and FTU-PB is 0.95. Overlapping area represents the amount of risk that can be diversified away by holding GOLDMAN SACHS CDR and US Financial 15 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on US Financial 15 and GOLDMAN SACHS 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 CDR are associated (or correlated) with US Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of US Financial 15 has no effect on the direction of GOLDMAN SACHS i.e., GOLDMAN SACHS and US Financial go up and down completely randomly.
Pair Corralation between GOLDMAN SACHS and US Financial
Assuming the 90 days trading horizon GOLDMAN SACHS CDR is expected to generate 1.62 times more return on investment than US Financial. However, GOLDMAN SACHS is 1.62 times more volatile than US Financial 15. It trades about 0.2 of its potential returns per unit of risk. US Financial 15 is currently generating about 0.17 per unit of risk. If you would invest 3,745 in GOLDMAN SACHS CDR on October 12, 2025 and sell it today you would earn a total of 799.00 from holding GOLDMAN SACHS CDR or generate 21.34% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
GOLDMAN SACHS CDR vs. US Financial 15
Performance |
| Timeline |
| GOLDMAN SACHS CDR |
| US Financial 15 |
GOLDMAN SACHS and US Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GOLDMAN SACHS and US Financial
The main advantage of trading using opposite GOLDMAN SACHS and US Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GOLDMAN SACHS position performs unexpectedly, US Financial 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 US Financial will offset losses from the drop in US Financial's long position.| GOLDMAN SACHS vs. Laurentian Bank | GOLDMAN SACHS vs. US Financial 15 | GOLDMAN SACHS vs. CVW CleanTech | GOLDMAN SACHS vs. CHAR Technologies |
| US Financial vs. North American Financial | US Financial vs. Financial 15 Split | US Financial vs. US Financial 15 | US Financial vs. Prime Dividend Corp |
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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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