Correlation Between Goldman Sachs and Allianzgi Nfj

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

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

Diversification Opportunities for Goldman Sachs and Allianzgi Nfj

-0.23

Correlation Coefficient

Goldman Sachs  Allianzgi Nfj

Very good diversification

The 3 months correlation between GOLDMAN and Allianzgi is -0.23. Overlapping area represents the amount of risk that can be diversified away by holding Goldman Sachs Short and Allianzgi Nfj Mid Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Allianzgi Nfj Mid and Goldman Sachs 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 Goldman Sachs Short are associated (or correlated) with Allianzgi Nfj. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Allianzgi Nfj Mid has no effect on the direction of Goldman Sachs i.e., Goldman Sachs and Allianzgi Nfj go up and down completely randomly.

Pair Corralation between Goldman Sachs and Allianzgi Nfj

Assuming the 90 days horizon Goldman Sachs is expected to generate 16.29 times less return on investment than Allianzgi Nfj. But when comparing it to its historical volatility, Goldman Sachs Short is 9.45 times less risky than Allianzgi Nfj. It trades about 0.2 of its potential returns per unit of risk. Allianzgi Nfj Mid Cap is currently generating about 0.34 of returns per unit of risk over similar time horizon. If you would invest  2,960  in Allianzgi Nfj Mid Cap on September 5, 2024 and sell it today you would earn a total of  152.00  from holding Allianzgi Nfj Mid Cap or generate 5.14% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Goldman Sachs Short  vs.  Allianzgi Nfj Mid Cap

Goldman Sachs Short

Risk-Adjusted Performance

0 of 100

Very Weak

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

Allianzgi Nfj Mid

Risk-Adjusted Performance

10 of 100

OK

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

Pair Trading with Goldman Sachs and Allianzgi Nfj

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

The idea behind Goldman Sachs Short and Allianzgi Nfj Mid Cap 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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.