Correlation Between Cm Commodity and Goldman Sachs

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

By analyzing existing cross correlation between Cm Modity Index and Goldman Sachs Short, you can compare the effects of market volatilities on Cm Commodity 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 Cm Commodity with a short position of Goldman Sachs. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cm Commodity and Goldman Sachs.

Diversification Opportunities for Cm Commodity and Goldman Sachs

0.15

Correlation Coefficient

Cm Commodity  Goldman Sachs

Average diversification

The 3 months correlation between COMIX and Goldman is 0.15. Overlapping area represents the amount of risk that can be diversified away by holding Cm Modity Index and Goldman Sachs Short in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Goldman Sachs Short and Cm Commodity 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 Cm Modity Index 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 Short has no effect on the direction of Cm Commodity i.e., Cm Commodity and Goldman Sachs go up and down completely randomly.

Pair Corralation between Cm Commodity and Goldman Sachs

Assuming the 90 days horizon Cm Modity Index is expected to generate 9.24 times more return on investment than Goldman Sachs. However, Cm Commodity is 9.24 times more volatile than Goldman Sachs Short. It trades about 0.08 of its potential returns per unit of risk. Goldman Sachs Short is currently generating about 0.37 per unit of risk. If you would invest  6,909  in Cm Modity Index on May 26, 2025 and sell it today you would earn a total of  202.00  from holding Cm Modity Index or generate 2.92% return on investment over 90 days.

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

Cm Modity Index  vs.  Goldman Sachs Short

Cm Modity Index

Risk-Adjusted Performance

Mild

Compared to the overall equity markets, risk-adjusted returns on investments in Cm Modity Index are ranked lower than 6 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong forward indicators, Cm Commodity is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Goldman Sachs Short

Risk-Adjusted Performance

Strong

Compared to the overall equity markets, risk-adjusted returns on investments in Goldman Sachs Short are ranked lower than 28 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong fundamental indicators, Goldman Sachs is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Cm Commodity and Goldman Sachs

The main advantage of trading using opposite Cm Commodity and Goldman Sachs positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cm Commodity 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 Cm Modity Index and Goldman Sachs Short 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 .