Correlation Between Fidelity New and Goldman Sachs

Can any of the company-specific risk be diversified away by investing in both Fidelity New 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 Fidelity New and Goldman Sachs into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Fidelity New Markets and Goldman Sachs Long, you can compare the effects of market volatilities on Fidelity New 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 Fidelity New with a short position of Goldman Sachs. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fidelity New and Goldman Sachs.

Diversification Opportunities for Fidelity New and Goldman Sachs

0.0

Correlation Coefficient

Fidelity New  Goldman Sachs

Pay attention - limited upside

The 3 months correlation between Fidelity and Goldman is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Fidelity New Markets and Goldman Sachs Long in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Goldman Sachs Long and Fidelity New 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 Fidelity New Markets 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 Long has no effect on the direction of Fidelity New i.e., Fidelity New and Goldman Sachs go up and down completely randomly.

Pair Corralation between Fidelity New and Goldman Sachs

If you would invest  1,262  in Fidelity New Markets on October 25, 2024 and sell it today you would earn a total of  15.00  from holding Fidelity New Markets or generate 1.19% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	1.69%
Values	Daily Returns

Fidelity New Markets  vs.  Goldman Sachs Long

Fidelity New Markets

Risk-Adjusted Performance

4 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Fidelity New Markets are ranked lower than 4 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong primary indicators, Fidelity New is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Goldman Sachs Long

Risk-Adjusted Performance

0 of 100

Good

Over the last 90 days Goldman Sachs Long has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong basic indicators, Goldman Sachs is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Fidelity New and Goldman Sachs

The main advantage of trading using opposite Fidelity New and Goldman Sachs positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fidelity New 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.

The idea behind Fidelity New Markets and Goldman Sachs Long pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.