Correlation Between Federated Mdt and Goldman Sachs
Can any of the company-specific risk be diversified away by investing in both Federated Mdt 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 Federated Mdt and Goldman Sachs into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Federated Mdt Small and Goldman Sachs High, you can compare the effects of market volatilities on Federated Mdt 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 Federated Mdt with a short position of Goldman Sachs. Check out your portfolio center. Please also check ongoing floating volatility patterns of Federated Mdt and Goldman Sachs.
Diversification Opportunities for Federated Mdt and Goldman Sachs
0.97 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Federated and Goldman is 0.97. Overlapping area represents the amount of risk that can be diversified away by holding Federated Mdt Small and Goldman Sachs High in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Goldman Sachs High and Federated Mdt 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 Federated Mdt Small 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 High has no effect on the direction of Federated Mdt i.e., Federated Mdt and Goldman Sachs go up and down completely randomly.
Pair Corralation between Federated Mdt and Goldman Sachs
Assuming the 90 days horizon Federated Mdt Small is expected to generate 4.04 times more return on investment than Goldman Sachs. However, Federated Mdt is 4.04 times more volatile than Goldman Sachs High. It trades about 0.13 of its potential returns per unit of risk. Goldman Sachs High is currently generating about 0.26 per unit of risk. If you would invest 2,769 in Federated Mdt Small on April 17, 2025 and sell it today you would earn a total of 73.00 from holding Federated Mdt Small or generate 2.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 95.24% |
| Values | Daily Returns |
Federated Mdt Small vs. Goldman Sachs High
Performance |
| Timeline |
| Federated Mdt Small |
| Goldman Sachs High |
Federated Mdt and Goldman Sachs Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Federated Mdt and Goldman Sachs
The main advantage of trading using opposite Federated Mdt and Goldman Sachs positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Federated Mdt 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.| Federated Mdt vs. T Rowe Price | Federated Mdt vs. The Hartford Midcap | Federated Mdt vs. Federated Mdt Small | Federated Mdt vs. Fidelity Small Cap |
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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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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