Correlation Between Goldman Sachs and The Arbitrage
Can any of the company-specific risk be diversified away by investing in both Goldman Sachs and The Arbitrage 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 The Arbitrage into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Goldman Sachs Small and The Arbitrage Credit, you can compare the effects of market volatilities on Goldman Sachs and The Arbitrage 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 The Arbitrage. Check out your portfolio center. Please also check ongoing floating volatility patterns of Goldman Sachs and The Arbitrage.
Diversification Opportunities for Goldman Sachs and The Arbitrage
0.22 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Goldman and The is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding Goldman Sachs Small and The Arbitrage Credit in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Arbitrage Credit 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 Small are associated (or correlated) with The Arbitrage. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Arbitrage Credit has no effect on the direction of Goldman Sachs i.e., Goldman Sachs and The Arbitrage go up and down completely randomly.
Pair Corralation between Goldman Sachs and The Arbitrage
Assuming the 90 days horizon Goldman Sachs Small is expected to generate 15.45 times more return on investment than The Arbitrage. However, Goldman Sachs is 15.45 times more volatile than The Arbitrage Credit. It trades about 0.05 of its potential returns per unit of risk. The Arbitrage Credit is currently generating about 0.16 per unit of risk. If you would invest 5,965 in Goldman Sachs Small on September 4, 2025 and sell it today you would earn a total of 223.00 from holding Goldman Sachs Small or generate 3.74% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Goldman Sachs Small vs. The Arbitrage Credit
Performance |
| Timeline |
| Goldman Sachs Small |
| Arbitrage Credit |
Goldman Sachs and The Arbitrage Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Goldman Sachs and The Arbitrage
The main advantage of trading using opposite Goldman Sachs and The Arbitrage positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Goldman Sachs position performs unexpectedly, The Arbitrage 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 The Arbitrage will offset losses from the drop in The Arbitrage's long position.| Goldman Sachs vs. Icon Financial Fund | Goldman Sachs vs. Angel Oak Financial | Goldman Sachs vs. 1919 Financial Services | Goldman Sachs vs. Prudential Financial Services |
| The Arbitrage vs. The Arbitrage Fund | The Arbitrage vs. The Arbitrage Fund | The Arbitrage vs. The Arbitrage Fund | The Arbitrage vs. The Arbitrage Credit |
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 Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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