Correlation Between Walker Dunlop and Allianzgi Global

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

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

Diversification Opportunities for Walker Dunlop and Allianzgi Global

0.28

Correlation Coefficient

Walker Dunlop  Allianzgi Global

Modest diversification

The 3 months correlation between Walker and Allianzgi is 0.28. Overlapping area represents the amount of risk that can be diversified away by holding Walker Dunlop and Allianzgi Global Natural in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Allianzgi Global Natural 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 Allianzgi Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Allianzgi Global Natural has no effect on the direction of Walker Dunlop i.e., Walker Dunlop and Allianzgi Global go up and down completely randomly.

Pair Corralation between Walker Dunlop and Allianzgi Global

Allowing for the 90-day total investment horizon Walker Dunlop is expected to generate 1.44 times less return on investment than Allianzgi Global. In addition to that, Walker Dunlop is 2.44 times more volatile than Allianzgi Global Natural. It trades about 0.04 of its total potential returns per unit of risk. Allianzgi Global Natural is currently generating about 0.12 per unit of volatility. If you would invest  1,047  in Allianzgi Global Natural on September 12, 2024 and sell it today you would earn a total of  55.00  from holding Allianzgi Global Natural or generate 5.25% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	98.44%
Values	Daily Returns

Walker Dunlop  vs.  Allianzgi Global Natural

Walker Dunlop

Risk-Adjusted Performance

2 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Walker Dunlop are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound fundamental indicators, Walker Dunlop is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.

Allianzgi Global Natural

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Allianzgi Global Natural are ranked lower than 9 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong forward indicators, Allianzgi Global is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Walker Dunlop and Allianzgi Global

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

The idea behind Walker Dunlop and Allianzgi Global Natural 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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.