Correlation Between GMS and AMGEN
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By analyzing existing cross correlation between GMS Inc and AMGEN INC, you can compare the effects of market volatilities on GMS and AMGEN 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 AMGEN. Check out your portfolio center. Please also check ongoing floating volatility patterns of GMS and AMGEN.
Diversification Opportunities for GMS and AMGEN
Excellent diversification
The 3 months correlation between GMS and AMGEN is -0.68. Overlapping area represents the amount of risk that can be diversified away by holding GMS Inc and AMGEN INC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AMGEN INC 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 AMGEN. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AMGEN INC has no effect on the direction of GMS i.e., GMS and AMGEN go up and down completely randomly.
Pair Corralation between GMS and AMGEN
Considering the 90-day investment horizon GMS Inc is expected to generate 1.55 times more return on investment than AMGEN. However, GMS is 1.55 times more volatile than AMGEN INC. It trades about 0.28 of its potential returns per unit of risk. AMGEN INC is currently generating about -0.11 per unit of risk. If you would invest 8,989 in GMS Inc on September 1, 2024 and sell it today you would earn a total of 1,046 from holding GMS Inc or generate 11.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
GMS Inc vs. AMGEN INC
Performance |
| Timeline |
| GMS Inc |
| AMGEN INC |
GMS and AMGEN Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GMS and AMGEN
The main advantage of trading using opposite GMS and AMGEN positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GMS position performs unexpectedly, AMGEN 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 AMGEN will offset losses from the drop in AMGEN's long position.| GMS vs. Quanex Building Products | GMS vs. Apogee Enterprises | GMS vs. Azek Company | GMS vs. Beacon Roofing Supply |
Check out your portfolio center.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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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