Correlation Between Goldman Sachs and Multi Units

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

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

Diversification Opportunities for Goldman Sachs and Multi Units

0.92

Correlation Coefficient

Goldman Sachs  Multi Units

Almost no diversification

The 3 months correlation between Goldman and Multi is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding Goldman Sachs Access and Multi Units Luxembourg in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Multi Units Luxembourg 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 Access are associated (or correlated) with Multi Units. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Multi Units Luxembourg has no effect on the direction of Goldman Sachs i.e., Goldman Sachs and Multi Units go up and down completely randomly.

Pair Corralation between Goldman Sachs and Multi Units

Assuming the 90 days trading horizon Goldman Sachs Access is expected to generate 6.09 times more return on investment than Multi Units. However, Goldman Sachs is 6.09 times more volatile than Multi Units Luxembourg. It trades about 0.21 of its potential returns per unit of risk. Multi Units Luxembourg is currently generating about 0.68 per unit of risk. If you would invest  5,323  in Goldman Sachs Access on April 24, 2025 and sell it today you would earn a total of  116.00  from holding Goldman Sachs Access or generate 2.18% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Strong
Accuracy	98.41%
Values	Daily Returns

Goldman Sachs Access  vs.  Multi Units Luxembourg

Goldman Sachs Access

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Goldman Sachs Access are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, Goldman Sachs is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Multi Units Luxembourg

Risk-Adjusted Performance

Excellent

Compared to the overall equity markets, risk-adjusted returns on investments in Multi Units Luxembourg are ranked lower than 53 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, Multi Units is not utilizing all of its potentials. The latest stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Goldman Sachs and Multi Units

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

The idea behind Goldman Sachs Access and Multi Units Luxembourg 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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.