Correlation Between GMS and Wienerberger

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

By analyzing existing cross correlation between GMS Inc and Wienerberger AG, you can compare the effects of market volatilities on GMS and Wienerberger 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 GMS with a short position of Wienerberger. Check out your portfolio center. Please also check ongoing floating volatility patterns of GMS and Wienerberger.

Diversification Opportunities for GMS and Wienerberger

0.0

Correlation Coefficient

GMS  Wienerberger

Pay attention - limited upside

The 3 months correlation between GMS and Wienerberger is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding GMS Inc and Wienerberger AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wienerberger AG and GMS 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 GMS Inc are associated (or correlated) with Wienerberger. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wienerberger AG has no effect on the direction of GMS i.e., GMS and Wienerberger go up and down completely randomly.

Pair Corralation between GMS and Wienerberger

If you would invest  3,248  in Wienerberger AG on October 11, 2024 and sell it today you would earn a total of  0.00  from holding Wienerberger AG or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	95.24%
Values	Daily Returns

GMS Inc  vs.  Wienerberger AG

GMS Inc

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days GMS Inc has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest weak performance, the Stock's primary indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

Wienerberger AG

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Wienerberger AG has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable fundamental drivers, Wienerberger is not utilizing all of its potentials. The recent stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with GMS and Wienerberger

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

The idea behind GMS Inc and Wienerberger AG 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 Money Managers module to screen money managers from public funds and ETFs managed around the world.