Correlation Between IShares Equity and Goldman Sachs
Can any of the company-specific risk be diversified away by investing in both IShares Equity 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 IShares Equity and Goldman Sachs into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between iShares Equity Factor and Goldman Sachs Access, you can compare the effects of market volatilities on IShares Equity 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 IShares Equity with a short position of Goldman Sachs. Check out your portfolio center. Please also check ongoing floating volatility patterns of IShares Equity and Goldman Sachs.
Diversification Opportunities for IShares Equity and Goldman Sachs
0.53 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between IShares and Goldman is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding iShares Equity Factor and Goldman Sachs Access in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Goldman Sachs Access and IShares Equity 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 iShares Equity Factor 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 Access has no effect on the direction of IShares Equity i.e., IShares Equity and Goldman Sachs go up and down completely randomly.
Pair Corralation between IShares Equity and Goldman Sachs
Given the investment horizon of 90 days IShares Equity is expected to generate 2.09 times less return on investment than Goldman Sachs. In addition to that, IShares Equity is 1.92 times more volatile than Goldman Sachs Access. It trades about 0.03 of its total potential returns per unit of risk. Goldman Sachs Access is currently generating about 0.12 per unit of volatility. If you would invest 4,492 in Goldman Sachs Access on March 16, 2025 and sell it today you would earn a total of 45.00 from holding Goldman Sachs Access or generate 1.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
iShares Equity Factor vs. Goldman Sachs Access
Performance |
| Timeline |
| iShares Equity Factor |
| Goldman Sachs Access |
IShares Equity and Goldman Sachs Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with IShares Equity and Goldman Sachs
The main advantage of trading using opposite IShares Equity and Goldman Sachs positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IShares Equity 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.| IShares Equity vs. iShares Edge MSCI | IShares Equity vs. iShares MSCI USA | IShares Equity vs. iShares MSCI USA | IShares Equity vs. Goldman Sachs ActiveBeta |
| Goldman Sachs vs. Goldman Sachs Access | Goldman Sachs vs. Goldman Sachs Access | Goldman Sachs vs. Goldman Sachs ActiveBeta | Goldman Sachs vs. Goldman Sachs ActiveBeta |
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 Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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