Correlation Between Goldman Sachs and ClearShares OCIO

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

By analyzing existing cross correlation between Goldman Sachs Future and ClearShares OCIO ETF, you can compare the effects of market volatilities on Goldman Sachs and ClearShares OCIO 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 ClearShares OCIO. Check out your portfolio center. Please also check ongoing floating volatility patterns of Goldman Sachs and ClearShares OCIO.

Diversification Opportunities for Goldman Sachs and ClearShares OCIO

-0.55

Correlation Coefficient

Goldman Sachs  ClearShares OCIO

Excellent diversification

The 3 months correlation between Goldman and ClearShares is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding Goldman Sachs Future and ClearShares OCIO ETF in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ClearShares OCIO ETF 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 Future are associated (or correlated) with ClearShares OCIO. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ClearShares OCIO ETF has no effect on the direction of Goldman Sachs i.e., Goldman Sachs and ClearShares OCIO go up and down completely randomly.

Pair Corralation between Goldman Sachs and ClearShares OCIO

Given the investment horizon of 90 days Goldman Sachs Future is expected to under-perform the ClearShares OCIO. In addition to that, Goldman Sachs is 1.4 times more volatile than ClearShares OCIO ETF. It trades about -0.16 of its total potential returns per unit of risk. ClearShares OCIO ETF is currently generating about 0.14 per unit of volatility. If you would invest  3,358  in ClearShares OCIO ETF on September 13, 2024 and sell it today you would earn a total of  143.00  from holding ClearShares OCIO ETF or generate 4.26% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Goldman Sachs Future  vs.  ClearShares OCIO ETF

Goldman Sachs Future

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Goldman Sachs Future has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest unsteady performance, the Etf's technical and fundamental indicators remain strong and the recent confusion on Wall Street may also be a sign of long-lasting gains for the Etf traders.

ClearShares OCIO ETF

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in ClearShares OCIO ETF are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of very healthy forward indicators, ClearShares OCIO is not utilizing all of its potentials. The latest stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with Goldman Sachs and ClearShares OCIO

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

The idea behind Goldman Sachs Future and ClearShares OCIO ETF 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.

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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.