Correlation Between Goldman Sachs and Alcoa Corp
Can any of the company-specific risk be diversified away by investing in both Goldman Sachs and Alcoa Corp 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 Alcoa Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Goldman Sachs Target and Alcoa Corp, you can compare the effects of market volatilities on Goldman Sachs and Alcoa Corp 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 Alcoa Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Goldman Sachs and Alcoa Corp.
Diversification Opportunities for Goldman Sachs and Alcoa Corp
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Goldman and Alcoa is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Goldman Sachs Target and Alcoa Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Alcoa Corp 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 Target are associated (or correlated) with Alcoa Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Alcoa Corp has no effect on the direction of Goldman Sachs i.e., Goldman Sachs and Alcoa Corp go up and down completely randomly.
Pair Corralation between Goldman Sachs and Alcoa Corp
If you would invest 2,523 in Alcoa Corp on January 26, 2024 and sell it today you would earn a total of 1,085 from holding Alcoa Corp or generate 43.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.82% |
| Values | Daily Returns |
Goldman Sachs Target vs. Alcoa Corp
Performance |
| Timeline |
| Goldman Sachs Target |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Alcoa Corp |
Goldman Sachs and Alcoa Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Goldman Sachs and Alcoa Corp
The main advantage of trading using opposite Goldman Sachs and Alcoa Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Goldman Sachs position performs unexpectedly, Alcoa Corp 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 Alcoa Corp will offset losses from the drop in Alcoa Corp's long position.| Goldman Sachs vs. Siit Emerging Markets | Goldman Sachs vs. Mid Cap 15x Strategy | Goldman Sachs vs. Gmo Emerging Markets | Goldman Sachs vs. Dws Emerging Markets |
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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 Stocks Directory module to find actively traded stocks across global markets.
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