Correlation Between Topbuild Corp and Mueller Industries

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

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

Diversification Opportunities for Topbuild Corp and Mueller Industries

0.19

Correlation Coefficient

Topbuild Corp  Mueller Industries

Average diversification

The 3 months correlation between Topbuild and Mueller is 0.19. Overlapping area represents the amount of risk that can be diversified away by holding Topbuild Corp and Mueller Industries in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mueller Industries and Topbuild Corp 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 Topbuild Corp 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 Topbuild Corp i.e., Topbuild Corp and Mueller Industries go up and down completely randomly.

Pair Corralation between Topbuild Corp and Mueller Industries

Considering the 90-day investment horizon Topbuild Corp is expected to generate 1.51 times less return on investment than Mueller Industries. In addition to that, Topbuild Corp is 1.83 times more volatile than Mueller Industries. It trades about 0.07 of its total potential returns per unit of risk. Mueller Industries is currently generating about 0.18 per unit of volatility. If you would invest  9,543  in Mueller Industries on August 31, 2025 and sell it today you would earn a total of  1,444  from holding Mueller Industries or generate 15.13% return on investment over 90 days.

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

Topbuild Corp  vs.  Mueller Industries

Topbuild Corp

Risk-Adjusted Performance

Mild

Compared to the overall equity markets, risk-adjusted returns on investments in Topbuild Corp are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of rather fragile essential indicators, Topbuild Corp may actually be approaching a critical reversion point that can send shares even higher in December 2025.

Mueller Industries

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Mueller Industries are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. Despite fairly fragile essential indicators, Mueller Industries demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Topbuild Corp and Mueller Industries

The main advantage of trading using opposite Topbuild Corp and Mueller Industries positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Topbuild Corp 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.

The idea behind Topbuild Corp and Mueller Industries 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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.