Correlation Between GMS and Axcelis Technologies

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

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

Diversification Opportunities for GMS and Axcelis Technologies

0.51

Correlation Coefficient

GMS  Axcelis Technologies

Very weak diversification

The 3 months correlation between GMS and Axcelis is 0.51. Overlapping area represents the amount of risk that can be diversified away by holding GMS Inc and Axcelis Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Axcelis Technologies 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 Axcelis Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Axcelis Technologies has no effect on the direction of GMS i.e., GMS and Axcelis Technologies go up and down completely randomly.

Pair Corralation between GMS and Axcelis Technologies

Considering the 90-day investment horizon GMS is expected to generate 87.06 times less return on investment than Axcelis Technologies. But when comparing it to its historical volatility, GMS Inc is 21.29 times less risky than Axcelis Technologies. It trades about 0.04 of its potential returns per unit of risk. Axcelis Technologies is currently generating about 0.16 of returns per unit of risk over similar time horizon. If you would invest  7,304  in Axcelis Technologies on July 3, 2025 and sell it today you would earn a total of  2,172  from holding Axcelis Technologies or generate 29.74% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	73.02%
Values	Daily Returns

GMS Inc  vs.  Axcelis Technologies

GMS Inc

Risk-Adjusted Performance

Soft

Over the last 90 days GMS Inc has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable primary indicators, GMS is not utilizing all of its potentials. The recent stock price uproar, may contribute to short-horizon losses for the private investors.

Axcelis Technologies

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Axcelis Technologies are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain essential indicators, Axcelis Technologies unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with GMS and Axcelis Technologies

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

The idea behind GMS Inc and Axcelis Technologies 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 Global Correlations module to find global opportunities by holding instruments from different markets.