Correlation Between GOLDMAN SACHS and Pro Real

Can any of the company-specific risk be diversified away by investing in both GOLDMAN SACHS and Pro Real 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 Pro Real into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between GOLDMAN SACHS CDR and Pro Real Estate, you can compare the effects of market volatilities on GOLDMAN SACHS and Pro Real 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 Pro Real. Check out your portfolio center. Please also check ongoing floating volatility patterns of GOLDMAN SACHS and Pro Real.

Diversification Opportunities for GOLDMAN SACHS and Pro Real

0.92

Correlation Coefficient

GOLDMAN SACHS  Pro Real

Almost no diversification

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

Pair Corralation between GOLDMAN SACHS and Pro Real

Assuming the 90 days trading horizon GOLDMAN SACHS CDR is expected to generate 1.43 times more return on investment than Pro Real. However, GOLDMAN SACHS is 1.43 times more volatile than Pro Real Estate. It trades about 0.37 of its potential returns per unit of risk. Pro Real Estate is currently generating about 0.31 per unit of risk. If you would invest  2,459  in GOLDMAN SACHS CDR on April 20, 2025 and sell it today you would earn a total of  1,011  from holding GOLDMAN SACHS CDR or generate 41.11% return on investment over 90 days.

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

GOLDMAN SACHS CDR  vs.  Pro Real Estate

GOLDMAN SACHS CDR

Risk-Adjusted Performance

Strong

Compared to the overall equity markets, risk-adjusted returns on investments in GOLDMAN SACHS CDR are ranked lower than 29 (%) of all global equities and portfolios over the last 90 days. In spite of very uncertain basic indicators, GOLDMAN SACHS displayed solid returns over the last few months and may actually be approaching a breakup point.

Pro Real Estate

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Pro Real Estate are ranked lower than 24 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Pro Real sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with GOLDMAN SACHS and Pro Real

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

The idea behind GOLDMAN SACHS CDR and Pro Real Estate 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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .