Correlation Between Goldman Sachs and Cypherpunk Holdings

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

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

Diversification Opportunities for Goldman Sachs and Cypherpunk Holdings

0.73

Correlation Coefficient

Goldman Sachs  Cypherpunk Holdings

Poor diversification

The 3 months correlation between Goldman and Cypherpunk is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Goldman Sachs Group and Cypherpunk Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cypherpunk Holdings 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 Group are associated (or correlated) with Cypherpunk Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cypherpunk Holdings has no effect on the direction of Goldman Sachs i.e., Goldman Sachs and Cypherpunk Holdings go up and down completely randomly.

Pair Corralation between Goldman Sachs and Cypherpunk Holdings

Allowing for the 90-day total investment horizon Goldman Sachs Group is expected to under-perform the Cypherpunk Holdings. But the stock apears to be less risky and, when comparing its historical volatility, Goldman Sachs Group is 5.04 times less risky than Cypherpunk Holdings. The stock trades about -0.03 of its potential returns per unit of risk. The Cypherpunk Holdings is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest  202.00  in Cypherpunk Holdings on December 30, 2024 and sell it today you would lose (43.00) from holding Cypherpunk Holdings or give up 21.29% of portfolio value over 90 days.

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

Goldman Sachs Group  vs.  Cypherpunk Holdings

Goldman Sachs Group

Risk-Adjusted Performance

Very Weak

Over the last 90 days Goldman Sachs Group has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Goldman Sachs is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Cypherpunk Holdings

Risk-Adjusted Performance

Very Weak

Over the last 90 days Cypherpunk Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly fragile basic indicators, Cypherpunk Holdings may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with Goldman Sachs and Cypherpunk Holdings

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

The idea behind Goldman Sachs Group and Cypherpunk Holdings 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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.