Correlation Between WestRock and Greif Bros

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

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

Diversification Opportunities for WestRock and Greif Bros

0.0

Correlation Coefficient

WestRock  Greif Bros

Pay attention - limited upside

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

Pair Corralation between WestRock and Greif Bros

If you would invest (100.00) in WestRock Co on December 28, 2024 and sell it today you would earn a total of  100.00  from holding WestRock Co or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

WestRock Co  vs.  Greif Bros

WestRock

Risk-Adjusted Performance

Very Weak

Over the last 90 days WestRock Co has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite persistent basic indicators, WestRock is not utilizing all of its potentials. The current stock price mess, may contribute to short-term losses for the institutional investors.

Greif Bros

Risk-Adjusted Performance

Very Weak

Over the last 90 days Greif Bros has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Stock's technical and fundamental indicators remain stable and the current disturbance on Wall Street may also be a sign of long-run gains for the company stockholders.

Pair Trading with WestRock and Greif Bros

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

The idea behind WestRock Co and Greif Bros 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 Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.