Correlation Between Aggressive Growth and Goldman Sachs

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

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

Diversification Opportunities for Aggressive Growth and Goldman Sachs

0.0

Correlation Coefficient

Aggressive Growth  Goldman Sachs

Pay attention - limited upside

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

Pair Corralation between Aggressive Growth and Goldman Sachs

If you would invest  3,384  in Goldman Sachs Technology on October 25, 2024 and sell it today you would earn a total of  305.00  from holding Goldman Sachs Technology or generate 9.01% return on investment over 90 days.

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

Aggressive Growth Portfolio  vs.  Goldman Sachs Technology

Aggressive Growth

Risk-Adjusted Performance

0 of 100

Insignificant

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

Goldman Sachs Technology

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Goldman Sachs Technology are ranked lower than 8 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak basic indicators, Goldman Sachs may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Pair Trading with Aggressive Growth and Goldman Sachs

The main advantage of trading using opposite Aggressive Growth and Goldman Sachs positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aggressive Growth 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 Aggressive Growth Portfolio and Goldman Sachs Technology 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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.