Correlation Between Sit Government and Goldman Sachs
Can any of the company-specific risk be diversified away by investing in both Sit Government 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 Sit Government and Goldman Sachs into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sit Government Securities and Goldman Sachs Government, you can compare the effects of market volatilities on Sit Government 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 Sit Government with a short position of Goldman Sachs. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sit Government and Goldman Sachs.
Diversification Opportunities for Sit Government and Goldman Sachs
0.77 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Sit and Goldman is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding Sit Government Securities and Goldman Sachs Government in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Goldman Sachs Government and Sit Government 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 Sit Government Securities 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 Government has no effect on the direction of Sit Government i.e., Sit Government and Goldman Sachs go up and down completely randomly.
Pair Corralation between Sit Government and Goldman Sachs
Assuming the 90 days horizon Sit Government Securities is expected to generate 0.77 times more return on investment than Goldman Sachs. However, Sit Government Securities is 1.3 times less risky than Goldman Sachs. It trades about 0.16 of its potential returns per unit of risk. Goldman Sachs Government is currently generating about 0.11 per unit of risk. If you would invest 1,008 in Sit Government Securities on December 28, 2024 and sell it today you would earn a total of 22.00 from holding Sit Government Securities or generate 2.18% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
Sit Government Securities vs. Goldman Sachs Government
Performance |
Timeline |
Sit Government Securities |
Goldman Sachs Government |
Sit Government and Goldman Sachs Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Sit Government and Goldman Sachs
The main advantage of trading using opposite Sit Government and Goldman Sachs positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sit Government 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.Sit Government vs. Vanguard Target Retirement | Sit Government vs. Multimanager Lifestyle Moderate | Sit Government vs. Blackrock Moderate Prepared | Sit Government vs. Tiaa Cref Lifecycle Retirement |
Goldman Sachs vs. United Kingdom Small | Goldman Sachs vs. Pace Smallmedium Value | Goldman Sachs vs. Small Midcap Dividend Income | Goldman Sachs vs. Cardinal Small Cap |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
Other Complementary Tools
Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. | |
CEOs Directory Screen CEOs from public companies around the world | |
Money Managers Screen money managers from public funds and ETFs managed around the world | |
ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments |