Correlation Between First BITCoin and Goldman Sachs

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Can any of the company-specific risk be diversified away by investing in both First BITCoin and Goldman Sachs 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 First BITCoin and Goldman Sachs into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between First BITCoin Capital and Goldman Sachs Group, you can compare the effects of market volatilities on First BITCoin and Goldman Sachs 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 First BITCoin with a short position of Goldman Sachs. Check out your portfolio center. Please also check ongoing floating volatility patterns of First BITCoin and Goldman Sachs.

Diversification Opportunities for First BITCoin and Goldman Sachs

-0.35
  Correlation Coefficient

Very good diversification

The 3 months correlation between First and Goldman is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding First BITCoin Capital and Goldman Sachs Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Goldman Sachs Group and First BITCoin 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 First BITCoin Capital are associated (or correlated) with Goldman Sachs. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Goldman Sachs Group has no effect on the direction of First BITCoin i.e., First BITCoin and Goldman Sachs go up and down completely randomly.

Pair Corralation between First BITCoin and Goldman Sachs

Assuming the 90 days horizon First BITCoin is expected to generate 2.4 times less return on investment than Goldman Sachs. In addition to that, First BITCoin is 9.48 times more volatile than Goldman Sachs Group. It trades about 0.01 of its total potential returns per unit of risk. Goldman Sachs Group is currently generating about 0.24 per unit of volatility. If you would invest  38,806  in Goldman Sachs Group on December 29, 2023 and sell it today you would earn a total of  2,719  from holding Goldman Sachs Group or generate 7.01% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthInsignificant
Accuracy100.0%
ValuesDaily Returns

First BITCoin Capital  vs.  Goldman Sachs Group

 Performance 
       Timeline  
First BITCoin Capital 

Risk-Adjusted Performance

13 of 100

 
Low
 
High
Good
Compared to the overall equity markets, risk-adjusted returns on investments in First BITCoin Capital are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. Despite nearly abnormal fundamental indicators, First BITCoin reported solid returns over the last few months and may actually be approaching a breakup point.
Goldman Sachs Group 

Risk-Adjusted Performance

9 of 100

 
Low
 
High
Modest
Compared to the overall equity markets, risk-adjusted returns on investments in Goldman Sachs Group are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively abnormal basic indicators, Goldman Sachs may actually be approaching a critical reversion point that can send shares even higher in April 2024.

First BITCoin and Goldman Sachs Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with First BITCoin and Goldman Sachs

The main advantage of trading using opposite First BITCoin and Goldman Sachs positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if First BITCoin position performs unexpectedly, Goldman Sachs 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 Goldman Sachs will offset losses from the drop in Goldman Sachs' long position.
The idea behind First BITCoin Capital and Goldman Sachs Group 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.
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.

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