Correlation Between Goldman Sachs and Rbc Small

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

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

Diversification Opportunities for Goldman Sachs and Rbc Small

0.75

Correlation Coefficient

Goldman Sachs  Rbc Small

Poor diversification

The 3 months correlation between GOLDMAN and Rbc is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding Goldman Sachs Technology and Rbc Small Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Rbc Small Cap 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 Technology are associated (or correlated) with Rbc Small. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Rbc Small Cap has no effect on the direction of Goldman Sachs i.e., Goldman Sachs and Rbc Small go up and down completely randomly.

Pair Corralation between Goldman Sachs and Rbc Small

Assuming the 90 days horizon Goldman Sachs Technology is expected to generate 0.89 times more return on investment than Rbc Small. However, Goldman Sachs Technology is 1.13 times less risky than Rbc Small. It trades about 0.19 of its potential returns per unit of risk. Rbc Small Cap is currently generating about 0.02 per unit of risk. If you would invest  2,818  in Goldman Sachs Technology on May 13, 2025 and sell it today you would earn a total of  318.00  from holding Goldman Sachs Technology or generate 11.28% return on investment over 90 days.

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

Goldman Sachs Technology  vs.  Rbc Small Cap

Goldman Sachs Technology

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Goldman Sachs Technology are ranked lower than 15 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak basic indicators, Goldman Sachs may actually be approaching a critical reversion point that can send shares even higher in September 2025.

Rbc Small Cap

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Rbc Small Cap are ranked lower than 1 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong forward indicators, Rbc Small is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Goldman Sachs and Rbc Small

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

The idea behind Goldman Sachs Technology and Rbc Small Cap 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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.