Correlation Between Geratherm Medical and Walmart

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

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

Diversification Opportunities for Geratherm Medical and Walmart

-0.03

Correlation Coefficient

Geratherm Medical  Walmart

Good diversification

The 3 months correlation between Geratherm and Walmart is -0.03. Overlapping area represents the amount of risk that can be diversified away by holding Geratherm Medical AG and Walmart in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Walmart and Geratherm Medical 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 Geratherm Medical AG are associated (or correlated) with Walmart. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Walmart has no effect on the direction of Geratherm Medical i.e., Geratherm Medical and Walmart go up and down completely randomly.

Pair Corralation between Geratherm Medical and Walmart

Assuming the 90 days trading horizon Geratherm Medical AG is expected to generate 2.16 times more return on investment than Walmart. However, Geratherm Medical is 2.16 times more volatile than Walmart. It trades about 0.12 of its potential returns per unit of risk. Walmart is currently generating about -0.01 per unit of risk. If you would invest  278.00  in Geratherm Medical AG on April 23, 2025 and sell it today you would earn a total of  57.00  from holding Geratherm Medical AG or generate 20.5% return on investment over 90 days.

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

Geratherm Medical AG  vs.  Walmart

Geratherm Medical

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Geratherm Medical AG are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively fragile technical and fundamental indicators, Geratherm Medical unveiled solid returns over the last few months and may actually be approaching a breakup point.

Walmart

Risk-Adjusted Performance

Very Weak

Over the last 90 days Walmart has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Walmart is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Geratherm Medical and Walmart

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

The idea behind Geratherm Medical AG and Walmart 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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.