Correlation Between Goldman Sachs and Precious Metals
Can any of the company-specific risk be diversified away by investing in both Goldman Sachs and Precious Metals 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 Precious Metals 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 Precious Metals Fund, you can compare the effects of market volatilities on Goldman Sachs and Precious Metals 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 Precious Metals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Goldman Sachs and Precious Metals.
Diversification Opportunities for Goldman Sachs and Precious Metals
0.58 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between GOLDMAN and PRECIOUS is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding Goldman Sachs Small and Precious Metals Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Precious Metals 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 Precious Metals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Precious Metals has no effect on the direction of Goldman Sachs i.e., Goldman Sachs and Precious Metals go up and down completely randomly.
Pair Corralation between Goldman Sachs and Precious Metals
Assuming the 90 days horizon Goldman Sachs Small is expected to generate 0.53 times more return on investment than Precious Metals. However, Goldman Sachs Small is 1.88 times less risky than Precious Metals. It trades about 0.21 of its potential returns per unit of risk. Precious Metals Fund is currently generating about 0.08 per unit of risk. If you would invest 3,923 in Goldman Sachs Small on April 23, 2025 and sell it today you would earn a total of 168.00 from holding Goldman Sachs Small or generate 4.28% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Goldman Sachs Small vs. Precious Metals Fund
Performance |
| Timeline |
| Goldman Sachs Small |
| Precious Metals |
Goldman Sachs and Precious Metals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Goldman Sachs and Precious Metals
The main advantage of trading using opposite Goldman Sachs and Precious Metals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Goldman Sachs position performs unexpectedly, Precious Metals 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 Precious Metals will offset losses from the drop in Precious Metals' long position.| Goldman Sachs vs. Goldman Sachs Clean | Goldman Sachs vs. Gabelli Gold Fund | Goldman Sachs vs. Precious Metals And | Goldman Sachs vs. James Balanced Golden |
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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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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