Correlation Between Goldman Sachs and Grayscale Zcash

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

By analyzing existing cross correlation between The Goldman Sachs and Grayscale Zcash Trust, you can compare the effects of market volatilities on Goldman Sachs and Grayscale Zcash 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 Grayscale Zcash. Check out your portfolio center. Please also check ongoing floating volatility patterns of Goldman Sachs and Grayscale Zcash.

Diversification Opportunities for Goldman Sachs and Grayscale Zcash

0.57

Correlation Coefficient

Goldman Sachs  Grayscale Zcash

Very weak diversification

The 3 months correlation between Goldman and Grayscale is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding The Goldman Sachs and Grayscale Zcash Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Grayscale Zcash Trust 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 The Goldman Sachs are associated (or correlated) with Grayscale Zcash. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Grayscale Zcash Trust has no effect on the direction of Goldman Sachs i.e., Goldman Sachs and Grayscale Zcash go up and down completely randomly.

Pair Corralation between Goldman Sachs and Grayscale Zcash

Assuming the 90 days horizon The Goldman Sachs is expected to generate 0.07 times more return on investment than Grayscale Zcash. However, The Goldman Sachs is 13.96 times less risky than Grayscale Zcash. It trades about -0.44 of its potential returns per unit of risk. Grayscale Zcash Trust is currently generating about -0.14 per unit of risk. If you would invest  2,353  in The Goldman Sachs on October 1, 2024 and sell it today you would lose (96.00) from holding The Goldman Sachs or give up 4.08% of portfolio value over 90 days.

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

The Goldman Sachs  vs.  Grayscale Zcash Trust

Goldman Sachs

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in The Goldman Sachs are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound basic indicators, Goldman Sachs is not utilizing all of its potentials. The new stock price tumult, may contribute to shorter-term losses for the shareholders.

Grayscale Zcash Trust

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Grayscale Zcash Trust are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Despite fairly fragile basic indicators, Grayscale Zcash demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Goldman Sachs and Grayscale Zcash

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

The idea behind The Goldman Sachs and Grayscale Zcash Trust 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 Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..