Correlation Between Walker Dunlop and Lassila Tikanoja

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

By analyzing existing cross correlation between Walker Dunlop and Lassila Tikanoja Oyj, you can compare the effects of market volatilities on Walker Dunlop and Lassila Tikanoja 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 Lassila Tikanoja. Check out your portfolio center. Please also check ongoing floating volatility patterns of Walker Dunlop and Lassila Tikanoja.

Diversification Opportunities for Walker Dunlop and Lassila Tikanoja

0.51

Correlation Coefficient

Walker Dunlop  Lassila Tikanoja

Very weak diversification

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

Pair Corralation between Walker Dunlop and Lassila Tikanoja

Allowing for the 90-day total investment horizon Walker Dunlop is expected to under-perform the Lassila Tikanoja. In addition to that, Walker Dunlop is 2.42 times more volatile than Lassila Tikanoja Oyj. It trades about -0.04 of its total potential returns per unit of risk. Lassila Tikanoja Oyj is currently generating about 0.45 per unit of volatility. If you would invest  778.00  in Lassila Tikanoja Oyj on October 23, 2024 and sell it today you would earn a total of  52.00  from holding Lassila Tikanoja Oyj or generate 6.68% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	83.33%
Values	Daily Returns

Walker Dunlop  vs.  Lassila Tikanoja Oyj

Walker Dunlop

Risk-Adjusted Performance

0 of 100

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 weak performance in the last few months, the Stock's fundamental indicators remain rather sound which may send shares a bit higher in February 2025. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

Lassila Tikanoja Oyj

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Lassila Tikanoja Oyj has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong technical indicators, Lassila Tikanoja is not utilizing all of its potentials. The current stock price confusion, may contribute to short-horizon losses for the traders.

Pair Trading with Walker Dunlop and Lassila Tikanoja

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

The idea behind Walker Dunlop and Lassila Tikanoja Oyj 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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.