Correlation Between GBS Software and Mueller Industries
Can any of the company-specific risk be diversified away by investing in both GBS Software and Mueller Industries 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 GBS Software and Mueller Industries into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GBS Software AG and Mueller Industries, you can compare the effects of market volatilities on GBS Software and Mueller Industries 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 GBS Software with a short position of Mueller Industries. Check out your portfolio center. Please also check ongoing floating volatility patterns of GBS Software and Mueller Industries.
Diversification Opportunities for GBS Software and Mueller Industries
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between GBS and Mueller is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding GBS Software AG and Mueller Industries in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mueller Industries and GBS Software 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 GBS Software AG are associated (or correlated) with Mueller Industries. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mueller Industries has no effect on the direction of GBS Software i.e., GBS Software and Mueller Industries go up and down completely randomly.
Pair Corralation between GBS Software and Mueller Industries
Assuming the 90 days trading horizon GBS Software AG is expected to generate 1.07 times more return on investment than Mueller Industries. However, GBS Software is 1.07 times more volatile than Mueller Industries. It trades about 0.19 of its potential returns per unit of risk. Mueller Industries is currently generating about 0.02 per unit of risk. If you would invest 260.00 in GBS Software AG on October 30, 2024 and sell it today you would earn a total of 42.00 from holding GBS Software AG or generate 16.15% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 97.37% |
| Values | Daily Returns |
GBS Software AG vs. Mueller Industries
Performance |
| Timeline |
| GBS Software AG |
| Mueller Industries |
GBS Software and Mueller Industries Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GBS Software and Mueller Industries
The main advantage of trading using opposite GBS Software and Mueller Industries positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GBS Software position performs unexpectedly, Mueller Industries 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 Mueller Industries will offset losses from the drop in Mueller Industries' long position.| GBS Software vs. EVS Broadcast Equipment | GBS Software vs. Elmos Semiconductor SE | GBS Software vs. Nordic Semiconductor ASA | GBS Software vs. Transport International Holdings |
| Mueller Industries vs. Television Broadcasts Limited | Mueller Industries vs. China BlueChemical | Mueller Industries vs. TITANIUM TRANSPORTGROUP | Mueller Industries vs. X FAB Silicon Foundries |
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 CEOs Directory module to screen CEOs from public companies around the world.
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