Correlation Between Gfl Environmental and GOLDMAN SACHS

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Can any of the company-specific risk be diversified away by investing in both Gfl Environmental 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 Gfl Environmental and GOLDMAN SACHS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Gfl Environmental Holdings and GOLDMAN SACHS CDR, you can compare the effects of market volatilities on Gfl Environmental 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 Gfl Environmental with a short position of GOLDMAN SACHS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gfl Environmental and GOLDMAN SACHS.

Diversification Opportunities for Gfl Environmental and GOLDMAN SACHS

0.53
  Correlation Coefficient

Very weak diversification

The 3 months correlation between Gfl and GOLDMAN is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding Gfl Environmental Holdings and GOLDMAN SACHS CDR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GOLDMAN SACHS CDR and Gfl Environmental 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 Gfl Environmental Holdings 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 CDR has no effect on the direction of Gfl Environmental i.e., Gfl Environmental and GOLDMAN SACHS go up and down completely randomly.

Pair Corralation between Gfl Environmental and GOLDMAN SACHS

Assuming the 90 days trading horizon Gfl Environmental is expected to generate 2.36 times less return on investment than GOLDMAN SACHS. But when comparing it to its historical volatility, Gfl Environmental Holdings is 1.62 times less risky than GOLDMAN SACHS. It trades about 0.1 of its potential returns per unit of risk. GOLDMAN SACHS CDR is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest  2,599  in GOLDMAN SACHS CDR on October 28, 2024 and sell it today you would earn a total of  564.00  from holding GOLDMAN SACHS CDR or generate 21.7% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthWeak
Accuracy100.0%
ValuesDaily Returns

Gfl Environmental Holdings  vs.  GOLDMAN SACHS CDR

 Performance 
JavaScript chart by amCharts 3.21.15NovDec2025 05101520
JavaScript chart by amCharts 3.21.15GFL GS
       Timeline  
Gfl Environmental 

Risk-Adjusted Performance

7 of 100

 
Weak
 
Strong
OK
Compared to the overall equity markets, risk-adjusted returns on investments in Gfl Environmental Holdings are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating essential indicators, Gfl Environmental may actually be approaching a critical reversion point that can send shares even higher in February 2025.
JavaScript chart by amCharts 3.21.15NovDecJanDecJan586062646668
GOLDMAN SACHS CDR 

Risk-Adjusted Performance

11 of 100

 
Weak
 
Strong
Good
Compared to the overall equity markets, risk-adjusted returns on investments in GOLDMAN SACHS CDR are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. In spite of very abnormal basic indicators, GOLDMAN SACHS displayed solid returns over the last few months and may actually be approaching a breakup point.
JavaScript chart by amCharts 3.21.15NovDecJanDecJan26272829303132

Gfl Environmental and GOLDMAN SACHS Volatility Contrast

   Predicted Return Density   
JavaScript chart by amCharts 3.21.15-4.53-3.39-2.25-1.120.01.132.313.484.655.83 0.050.100.15
JavaScript chart by amCharts 3.21.15GFL GS
       Returns  

Pair Trading with Gfl Environmental and GOLDMAN SACHS

The main advantage of trading using opposite Gfl Environmental and GOLDMAN SACHS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gfl Environmental 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's long position.
The idea behind Gfl Environmental Holdings and GOLDMAN SACHS CDR 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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.

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