Correlation Between Goldman Sachs and Travelers Companies
Can any of the company-specific risk be diversified away by investing in both Goldman Sachs and Travelers Companies 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 Travelers Companies 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 The Travelers Companies, you can compare the effects of market volatilities on Goldman Sachs and Travelers Companies 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 Travelers Companies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Goldman Sachs and Travelers Companies.
Diversification Opportunities for Goldman Sachs and Travelers Companies
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Goldman and Travelers is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Goldman Sachs Target and The Travelers Companies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on The Travelers Companies 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 Travelers Companies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of The Travelers Companies has no effect on the direction of Goldman Sachs i.e., Goldman Sachs and Travelers Companies go up and down completely randomly.
Pair Corralation between Goldman Sachs and Travelers Companies
Assuming the 90 days horizon Goldman Sachs Target is expected to under-perform the Travelers Companies. But the mutual fund apears to be less risky and, when comparing its historical volatility, Goldman Sachs Target is 1.43 times less risky than Travelers Companies. The mutual fund trades about -0.01 of its potential returns per unit of risk. The The Travelers Companies is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 17,148 in The Travelers Companies on January 20, 2024 and sell it today you would earn a total of 3,894 from holding The Travelers Companies or generate 22.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 52.74% |
| Values | Daily Returns |
Goldman Sachs Target vs. The Travelers Companies
Performance |
| Timeline |
| Goldman Sachs Target |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| The Travelers Companies |
Goldman Sachs and Travelers Companies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Goldman Sachs and Travelers Companies
The main advantage of trading using opposite Goldman Sachs and Travelers Companies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Goldman Sachs position performs unexpectedly, Travelers Companies 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 Travelers Companies will offset losses from the drop in Travelers Companies' long position.| Goldman Sachs vs. Rbb Fund | Goldman Sachs vs. Semiconductor Ultrasector Profund | Goldman Sachs vs. Eic Value Fund | Goldman Sachs vs. Rbc Funds Trust |
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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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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