Correlation Between Walker Dunlop and 694308KH9

Can any of the company-specific risk be diversified away by investing in both Walker Dunlop and 694308KH9 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 694308KH9 into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Walker Dunlop and PCG 675 15 JAN 53, you can compare the effects of market volatilities on Walker Dunlop and 694308KH9 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 694308KH9. Check out your portfolio center. Please also check ongoing floating volatility patterns of Walker Dunlop and 694308KH9.

Diversification Opportunities for Walker Dunlop and 694308KH9

-0.07

Correlation Coefficient

Walker Dunlop  694308KH9

Good diversification

The 3 months correlation between Walker and 694308KH9 is -0.07. Overlapping area represents the amount of risk that can be diversified away by holding Walker Dunlop and PCG 675 15 JAN 53 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PCG 675 15 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 694308KH9. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PCG 675 15 has no effect on the direction of Walker Dunlop i.e., Walker Dunlop and 694308KH9 go up and down completely randomly.

Pair Corralation between Walker Dunlop and 694308KH9

Allowing for the 90-day total investment horizon Walker Dunlop is expected to under-perform the 694308KH9. But the stock apears to be less risky and, when comparing its historical volatility, Walker Dunlop is 1.22 times less risky than 694308KH9. The stock trades about -0.08 of its potential returns per unit of risk. The PCG 675 15 JAN 53 is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest  10,940  in PCG 675 15 JAN 53 on December 24, 2024 and sell it today you would lose (218.00) from holding PCG 675 15 JAN 53 or give up 1.99% of portfolio value over 90 days.

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

Walker Dunlop  vs.  PCG 675 15 JAN 53

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.

PCG 675 15

Risk-Adjusted Performance

Very Weak

Over the last 90 days PCG 675 15 JAN 53 has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, 694308KH9 is not utilizing all of its potentials. The newest stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Walker Dunlop and 694308KH9

The main advantage of trading using opposite Walker Dunlop and 694308KH9 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Walker Dunlop position performs unexpectedly, 694308KH9 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 694308KH9 will offset losses from the drop in 694308KH9's long position.

The idea behind Walker Dunlop and PCG 675 15 JAN 53 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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.