Correlation Between Blackrock and Goldman Sachs

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

By analyzing existing cross correlation between Blackrock Sm Cap and Goldman Sachs Target, you can compare the effects of market volatilities on Blackrock 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 Blackrock with a short position of Goldman Sachs. Check out your portfolio center. Please also check ongoing floating volatility patterns of Blackrock and Goldman Sachs.

Diversification Opportunities for Blackrock and Goldman Sachs

0.0

Correlation Coefficient

Blackrock  Goldman Sachs

Pay attention - limited upside

The 3 months correlation between Blackrock and Goldman is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Blackrock Sm Cap and Goldman Sachs Target in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Goldman Sachs Target and Blackrock 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 Blackrock Sm Cap 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 Target has no effect on the direction of Blackrock i.e., Blackrock and Goldman Sachs go up and down completely randomly.

Pair Corralation between Blackrock and Goldman Sachs

If you would invest  776.00  in Goldman Sachs Target on September 13, 2024 and sell it today you would earn a total of  0.00  from holding Goldman Sachs Target or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	4.55%
Values	Daily Returns

Blackrock Sm Cap  vs.  Goldman Sachs Target

Blackrock Sm Cap

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Blackrock Sm Cap are ranked lower than 10 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak forward-looking signals, Blackrock may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Goldman Sachs Target

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Goldman Sachs Target has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong forward-looking indicators, Goldman Sachs is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Blackrock and Goldman Sachs

The main advantage of trading using opposite Blackrock and Goldman Sachs positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Blackrock 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' long position.

The idea behind Blackrock Sm Cap and Goldman Sachs Target 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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.