Correlation Between Goldman Sachs and Jupai Holdings

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

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

Diversification Opportunities for Goldman Sachs and Jupai Holdings

0.57

Correlation Coefficient

Goldman Sachs  Jupai Holdings

Very weak diversification

The 3 months correlation between Goldman and Jupai is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding Goldman Sachs BDC and Jupai Holdings Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jupai Holdings 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 BDC are associated (or correlated) with Jupai Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jupai Holdings has no effect on the direction of Goldman Sachs i.e., Goldman Sachs and Jupai Holdings go up and down completely randomly.

Pair Corralation between Goldman Sachs and Jupai Holdings

If you would invest  3.89  in Jupai Holdings Limited on July 18, 2024 and sell it today you would earn a total of  0.00  from holding Jupai Holdings Limited or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	4.35%
Values	Daily Returns

Goldman Sachs BDC  vs.  Jupai Holdings Limited

Goldman Sachs BDC

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Goldman Sachs BDC has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest unsteady performance, the Stock's fundamental drivers remain sound and the latest tumult on Wall Street may also be a sign of longer-term gains for the firm shareholders.

Jupai Holdings

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Jupai Holdings Limited has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong basic indicators, Jupai Holdings 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 Jupai Holdings

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

The idea behind Goldman Sachs BDC and Jupai Holdings Limited 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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.