Correlation Between Vy Goldman and Precious Metals

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

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

Diversification Opportunities for Vy Goldman and Precious Metals

0.64

Correlation Coefficient

Vy Goldman  Precious Metals

Poor diversification

The 3 months correlation between VGSBX and Precious is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Vy Goldman Sachs and Precious Metals Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Precious Metals and Vy Goldman 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 Vy Goldman Sachs are associated (or correlated) with Precious Metals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Precious Metals has no effect on the direction of Vy Goldman i.e., Vy Goldman and Precious Metals go up and down completely randomly.

Pair Corralation between Vy Goldman and Precious Metals

Assuming the 90 days horizon Vy Goldman is expected to generate 13.38 times less return on investment than Precious Metals. But when comparing it to its historical volatility, Vy Goldman Sachs is 8.33 times less risky than Precious Metals. It trades about 0.13 of its potential returns per unit of risk. Precious Metals Fund is currently generating about 0.22 of returns per unit of risk over similar time horizon. If you would invest  10,161  in Precious Metals Fund on December 20, 2024 and sell it today you would earn a total of  2,745  from holding Precious Metals Fund or generate 27.02% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	98.33%
Values	Daily Returns

Vy Goldman Sachs  vs.  Precious Metals Fund

Vy Goldman Sachs

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Vy Goldman Sachs are ranked lower than 10 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong fundamental drivers, Vy Goldman is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Precious Metals

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Precious Metals Fund are ranked lower than 17 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak basic indicators, Precious Metals showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Vy Goldman and Precious Metals

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

The idea behind Vy Goldman Sachs and Precious Metals Fund 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 CEOs Directory module to screen CEOs from public companies around the world.