Correlation Between Blue Owl and Goldman Sachs

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

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

Diversification Opportunities for Blue Owl and Goldman Sachs

-0.51

Correlation Coefficient

Blue Owl  Goldman Sachs

Excellent diversification

The 3 months correlation between Blue and Goldman is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding Blue Owl Capital and Goldman Sachs Physical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Goldman Sachs Physical and Blue Owl 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 Blue Owl Capital 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 Physical has no effect on the direction of Blue Owl i.e., Blue Owl and Goldman Sachs go up and down completely randomly.

Pair Corralation between Blue Owl and Goldman Sachs

Considering the 90-day investment horizon Blue Owl Capital is expected to under-perform the Goldman Sachs. In addition to that, Blue Owl is 3.33 times more volatile than Goldman Sachs Physical. It trades about -0.07 of its total potential returns per unit of risk. Goldman Sachs Physical is currently generating about 0.3 per unit of volatility. If you would invest  2,586  in Goldman Sachs Physical on December 27, 2024 and sell it today you would earn a total of  396.00  from holding Goldman Sachs Physical or generate 15.31% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	98.36%
Values	Daily Returns

Blue Owl Capital  vs.  Goldman Sachs Physical

Blue Owl Capital

Risk-Adjusted Performance

Very Weak

Over the last 90 days Blue Owl Capital has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest unfluctuating performance, the Stock's basic indicators remain persistent and the latest mess on Wall Street may also be a sign of long-standing gains for the company institutional investors.

Goldman Sachs Physical

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Goldman Sachs Physical are ranked lower than 23 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively conflicting basic indicators, Goldman Sachs unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Blue Owl and Goldman Sachs

The main advantage of trading using opposite Blue Owl and Goldman Sachs positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Blue Owl 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 Blue Owl Capital and Goldman Sachs Physical 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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.