Correlation Between Walmart and TGS Esports

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

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

Diversification Opportunities for Walmart and TGS Esports

0.0

Correlation Coefficient

Walmart  TGS Esports

Pay attention - limited upside

The 3 months correlation between Walmart and TGS is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Walmart Inc CDR and TGS Esports in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TGS Esports and Walmart 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 Walmart Inc CDR are associated (or correlated) with TGS Esports. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TGS Esports has no effect on the direction of Walmart i.e., Walmart and TGS Esports go up and down completely randomly.

Pair Corralation between Walmart and TGS Esports

If you would invest  2,067  in Walmart Inc CDR on September 23, 2024 and sell it today you would earn a total of  1,935  from holding Walmart Inc CDR or generate 93.61% return on investment over 90 days.

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

Walmart Inc CDR  vs.  TGS Esports

Walmart Inc CDR

Risk-Adjusted Performance

16 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Walmart Inc CDR are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating basic indicators, Walmart displayed solid returns over the last few months and may actually be approaching a breakup point.

TGS Esports

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days TGS Esports has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable basic indicators, TGS Esports is not utilizing all of its potentials. The latest stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Pair Trading with Walmart and TGS Esports

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

The idea behind Walmart Inc CDR and TGS Esports 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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.