Correlation Between Walmart and ATAKW Old

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

By analyzing existing cross correlation between Walmart and ATAKW Old, you can compare the effects of market volatilities on Walmart and ATAKW Old 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 ATAKW Old. Check out your portfolio center. Please also check ongoing floating volatility patterns of Walmart and ATAKW Old.

Diversification Opportunities for Walmart and ATAKW Old

-0.37

Correlation Coefficient

Walmart  ATAKW Old

Very good diversification

The 3 months correlation between Walmart and ATAKW is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding Walmart and ATAKW Old in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ATAKW Old 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 are associated (or correlated) with ATAKW Old. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ATAKW Old has no effect on the direction of Walmart i.e., Walmart and ATAKW Old go up and down completely randomly.

Pair Corralation between Walmart and ATAKW Old

If you would invest  7,943  in Walmart on October 10, 2024 and sell it today you would earn a total of  1,138  from holding Walmart or generate 14.33% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	1.64%
Values	Daily Returns

Walmart  vs.  ATAKW Old

Walmart

Risk-Adjusted Performance

16 of 100

Good

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

ATAKW Old

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days ATAKW Old has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable forward-looking signals, ATAKW Old 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 ATAKW Old

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

The idea behind Walmart and ATAKW Old 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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.