Correlation Between ACCESS Newswire and GMS

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

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

Diversification Opportunities for ACCESS Newswire and GMS

0.78

Correlation Coefficient

ACCESS Newswire  GMS

Poor diversification

The 3 months correlation between ACCESS and GMS is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding ACCESS Newswire and GMS Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GMS Inc and ACCESS Newswire 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 ACCESS Newswire are associated (or correlated) with GMS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GMS Inc has no effect on the direction of ACCESS Newswire i.e., ACCESS Newswire and GMS go up and down completely randomly.

Pair Corralation between ACCESS Newswire and GMS

Given the investment horizon of 90 days ACCESS Newswire is expected to generate 1.44 times less return on investment than GMS. But when comparing it to its historical volatility, ACCESS Newswire is 1.11 times less risky than GMS. It trades about 0.13 of its potential returns per unit of risk. GMS Inc is currently generating about 0.17 of returns per unit of risk over similar time horizon. If you would invest  7,713  in GMS Inc on May 16, 2025 and sell it today you would earn a total of  3,246  from holding GMS Inc or generate 42.08% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	100.0%
Values	Daily Returns

ACCESS Newswire  vs.  GMS Inc

ACCESS Newswire

Risk-Adjusted Performance

Fair

Compared to the overall equity markets, risk-adjusted returns on investments in ACCESS Newswire are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively fragile fundamental indicators, ACCESS Newswire unveiled solid returns over the last few months and may actually be approaching a breakup point.

GMS Inc

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in GMS Inc are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively inconsistent primary indicators, GMS unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with ACCESS Newswire and GMS

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

The idea behind ACCESS Newswire and GMS Inc 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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.