Correlation Between Walmart and SonicShares Global

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

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

Diversification Opportunities for Walmart and SonicShares Global

-0.87

Correlation Coefficient

Walmart  SonicShares Global

Pay attention - limited upside

The 3 months correlation between Walmart and SonicShares is -0.87. Overlapping area represents the amount of risk that can be diversified away by holding Walmart and SonicShares Global Shipping in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SonicShares Global 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 SonicShares Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SonicShares Global has no effect on the direction of Walmart i.e., Walmart and SonicShares Global go up and down completely randomly.

Pair Corralation between Walmart and SonicShares Global

Considering the 90-day investment horizon Walmart is expected to generate 0.98 times more return on investment than SonicShares Global. However, Walmart is 1.02 times less risky than SonicShares Global. It trades about 0.1 of its potential returns per unit of risk. SonicShares Global Shipping is currently generating about -0.17 per unit of risk. If you would invest  8,819  in Walmart on October 22, 2024 and sell it today you would earn a total of  375.00  from holding Walmart or generate 4.25% return on investment over 90 days.

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

Walmart  vs.  SonicShares Global Shipping

Walmart

Risk-Adjusted Performance

14 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Walmart are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively fragile primary indicators, Walmart may actually be approaching a critical reversion point that can send shares even higher in February 2025.

SonicShares Global

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days SonicShares Global Shipping has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest weak performance, the Etf's basic indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the exchange-traded fund private investors.

Pair Trading with Walmart and SonicShares Global

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

The idea behind Walmart and SonicShares Global Shipping 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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.