Correlation Between Walmart and IShares International

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

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

Diversification Opportunities for Walmart and IShares International

0.26

Correlation Coefficient

Walmart  IShares International

Modest diversification

The 3 months correlation between Walmart and IShares is 0.26. Overlapping area represents the amount of risk that can be diversified away by holding Walmart and iShares International Develope in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on iShares International 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 IShares International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of iShares International has no effect on the direction of Walmart i.e., Walmart and IShares International go up and down completely randomly.

Pair Corralation between Walmart and IShares International

Considering the 90-day investment horizon Walmart is expected to under-perform the IShares International. In addition to that, Walmart is 2.19 times more volatile than iShares International Developed. It trades about -0.07 of its total potential returns per unit of risk. iShares International Developed is currently generating about 0.06 per unit of volatility. If you would invest  1,932  in iShares International Developed on December 26, 2024 and sell it today you would earn a total of  58.00  from holding iShares International Developed or generate 3.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Walmart  vs.  iShares International Develope

Walmart

Risk-Adjusted Performance

Very Weak

Over the last 90 days Walmart has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest unsteady performance, the Stock's primary indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

iShares International

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in iShares International Developed are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite quite persistent technical and fundamental indicators, IShares International is not utilizing all of its potentials. The newest stock price mess, may contribute to short-term losses for the institutional investors.

Pair Trading with Walmart and IShares International

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

The idea behind Walmart and iShares International Developed 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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.