Correlation Between Gerdau SA and Artisan Global

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

By analyzing existing cross correlation between Gerdau SA ADR and Artisan Global Value, you can compare the effects of market volatilities on Gerdau SA and Artisan Global 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 Gerdau SA with a short position of Artisan Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gerdau SA and Artisan Global.

Diversification Opportunities for Gerdau SA and Artisan Global

0.53

Correlation Coefficient

Gerdau SA  Artisan Global

Very weak diversification

The 3 months correlation between Gerdau and Artisan is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding Gerdau SA ADR and Artisan Global Value in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Artisan Global Value and Gerdau SA 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 Gerdau SA ADR are associated (or correlated) with Artisan Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Artisan Global Value has no effect on the direction of Gerdau SA i.e., Gerdau SA and Artisan Global go up and down completely randomly.

Pair Corralation between Gerdau SA and Artisan Global

Considering the 90-day investment horizon Gerdau SA ADR is expected to generate 3.86 times more return on investment than Artisan Global. However, Gerdau SA is 3.86 times more volatile than Artisan Global Value. It trades about 0.11 of its potential returns per unit of risk. Artisan Global Value is currently generating about 0.17 per unit of risk. If you would invest  251.00  in Gerdau SA ADR on May 7, 2025 and sell it today you would earn a total of  41.00  from holding Gerdau SA ADR or generate 16.33% return on investment over 90 days.

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

Gerdau SA ADR  vs.  Artisan Global Value

Gerdau SA ADR

Risk-Adjusted Performance

Fair

Compared to the overall equity markets, risk-adjusted returns on investments in Gerdau SA ADR are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Despite somewhat unsteady technical and fundamental indicators, Gerdau SA sustained solid returns over the last few months and may actually be approaching a breakup point.

Artisan Global Value

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Artisan Global Value are ranked lower than 13 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak technical and fundamental indicators, Artisan Global may actually be approaching a critical reversion point that can send shares even higher in September 2025.

Pair Trading with Gerdau SA and Artisan Global

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

The idea behind Gerdau SA ADR and Artisan Global Value 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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.