Correlation Between Walker Dunlop and CI Gold

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

By analyzing existing cross correlation between Walker Dunlop and CI Gold Giants, you can compare the effects of market volatilities on Walker Dunlop and CI Gold 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 Walker Dunlop with a short position of CI Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of Walker Dunlop and CI Gold.

Diversification Opportunities for Walker Dunlop and CI Gold

-0.67

Correlation Coefficient

Walker Dunlop  CI Gold

Excellent diversification

The 3 months correlation between Walker and CGXF is -0.67. Overlapping area represents the amount of risk that can be diversified away by holding Walker Dunlop and CI Gold Giants in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CI Gold Giants and Walker Dunlop 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 Walker Dunlop are associated (or correlated) with CI Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CI Gold Giants has no effect on the direction of Walker Dunlop i.e., Walker Dunlop and CI Gold go up and down completely randomly.

Pair Corralation between Walker Dunlop and CI Gold

Allowing for the 90-day total investment horizon Walker Dunlop is expected to under-perform the CI Gold. In addition to that, Walker Dunlop is 1.39 times more volatile than CI Gold Giants. It trades about -0.08 of its total potential returns per unit of risk. CI Gold Giants is currently generating about 0.34 per unit of volatility. If you would invest  990.00  in CI Gold Giants on December 28, 2024 and sell it today you would earn a total of  336.00  from holding CI Gold Giants or generate 33.94% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	96.77%
Values	Daily Returns

Walker Dunlop  vs.  CI Gold Giants

Walker Dunlop

Risk-Adjusted Performance

Very Weak

Over the last 90 days Walker Dunlop has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest weak performance, the Stock's fundamental indicators remain sound and the latest tumult on Wall Street may also be a sign of longer-term gains for the firm shareholders.

CI Gold Giants

Risk-Adjusted Performance

Strong

Compared to the overall equity markets, risk-adjusted returns on investments in CI Gold Giants are ranked lower than 27 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating basic indicators, CI Gold displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Walker Dunlop and CI Gold

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

The idea behind Walker Dunlop and CI Gold Giants 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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.