Correlation Between Goldman Sachs and Lazard Us

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

By analyzing existing cross correlation between Goldman Sachs Growth and Lazard Strategic Equity, you can compare the effects of market volatilities on Goldman Sachs and Lazard Us 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 Lazard Us. Check out your portfolio center. Please also check ongoing floating volatility patterns of Goldman Sachs and Lazard Us.

Diversification Opportunities for Goldman Sachs and Lazard Us

0.89

Correlation Coefficient

Goldman Sachs  Lazard Us

Very poor diversification

The 3 months correlation between Goldman and Lazard is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding Goldman Sachs Growth and Lazard Strategic Equity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lazard Strategic Equity 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 Growth are associated (or correlated) with Lazard Us. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lazard Strategic Equity has no effect on the direction of Goldman Sachs i.e., Goldman Sachs and Lazard Us go up and down completely randomly.

Pair Corralation between Goldman Sachs and Lazard Us

Assuming the 90 days horizon Goldman Sachs Growth is expected to generate 1.65 times more return on investment than Lazard Us. However, Goldman Sachs is 1.65 times more volatile than Lazard Strategic Equity. It trades about 0.3 of its potential returns per unit of risk. Lazard Strategic Equity is currently generating about -0.01 per unit of risk. If you would invest  2,310  in Goldman Sachs Growth on September 9, 2024 and sell it today you would earn a total of  129.00  from holding Goldman Sachs Growth or generate 5.58% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Strong
Accuracy	100.0%
Values	Daily Returns

Goldman Sachs Growth  vs.  Lazard Strategic Equity

Goldman Sachs Growth

Risk-Adjusted Performance

32 of 100

Very Strong

Compared to the overall equity markets, risk-adjusted returns on investments in Goldman Sachs Growth are ranked lower than 32 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak fundamental indicators, Goldman Sachs showed solid returns over the last few months and may actually be approaching a breakup point.

Lazard Strategic Equity

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Lazard Strategic Equity are ranked lower than 9 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, Lazard Us is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Goldman Sachs and Lazard Us

The main advantage of trading using opposite Goldman Sachs and Lazard Us positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Goldman Sachs position performs unexpectedly, Lazard Us 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 Lazard Us will offset losses from the drop in Lazard Us' long position.

The idea behind Goldman Sachs Growth and Lazard Strategic Equity 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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.