Correlation Between GMS and Yik Wo
Can any of the company-specific risk be diversified away by investing in both GMS and Yik Wo 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 Yik Wo into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GMS Inc and Yik Wo International, you can compare the effects of market volatilities on GMS and Yik Wo 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 Yik Wo. Check out your portfolio center. Please also check ongoing floating volatility patterns of GMS and Yik Wo.
Diversification Opportunities for GMS and Yik Wo
Pay attention - limited upside
The 3 months correlation between GMS and Yik is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding GMS Inc and Yik Wo International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Yik Wo International 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 Yik Wo. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Yik Wo International has no effect on the direction of GMS i.e., GMS and Yik Wo go up and down completely randomly.
Pair Corralation between GMS and Yik Wo
If you would invest 8,212 in GMS Inc on September 14, 2024 and sell it today you would earn a total of 879.50 from holding GMS Inc or generate 10.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.4% |
| Values | Daily Returns |
GMS Inc vs. Yik Wo International
Performance |
| Timeline |
| GMS Inc |
| Yik Wo International |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
GMS and Yik Wo Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GMS and Yik Wo
The main advantage of trading using opposite GMS and Yik Wo positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GMS position performs unexpectedly, Yik Wo 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 Yik Wo will offset losses from the drop in Yik Wo's long position.| GMS vs. Quanex Building Products | GMS vs. Apogee Enterprises | GMS vs. Azek Company | GMS vs. Beacon Roofing Supply |
| Yik Wo vs. Alaska Air Group | Yik Wo vs. 17 Education Technology | Yik Wo vs. Afya | Yik Wo vs. WEBTOON Entertainment Common |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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