Correlation Between Goldman Sachs and Hafnia

Can any of the company-specific risk be diversified away by investing in both Goldman Sachs and Hafnia 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 Hafnia 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 Hafnia Limited, you can compare the effects of market volatilities on Goldman Sachs and Hafnia 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 Hafnia. Check out your portfolio center. Please also check ongoing floating volatility patterns of Goldman Sachs and Hafnia.

Diversification Opportunities for Goldman Sachs and Hafnia

0.0

Correlation Coefficient

Goldman Sachs  Hafnia

Pay attention - limited upside

The 3 months correlation between Goldman and Hafnia is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Goldman Sachs Group and Hafnia Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hafnia Limited 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 Hafnia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hafnia Limited has no effect on the direction of Goldman Sachs i.e., Goldman Sachs and Hafnia go up and down completely randomly.

Pair Corralation between Goldman Sachs and Hafnia

If you would invest  55,126  in Goldman Sachs Group on December 19, 2024 and sell it today you would earn a total of  52.00  from holding Goldman Sachs Group or generate 0.09% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Goldman Sachs Group  vs.  Hafnia Limited

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.

Hafnia Limited

Risk-Adjusted Performance

Very Weak

Over the last 90 days Hafnia Limited has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Hafnia is not utilizing all of its potentials. The recent stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Goldman Sachs and Hafnia

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

The idea behind Goldman Sachs Group and Hafnia Limited 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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.