Correlation Between General Dynamics and Walmart
Can any of the company-specific risk be diversified away by investing in both General Dynamics and Walmart 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 General Dynamics and Walmart into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between General Dynamics Corp and Walmart, you can compare the effects of market volatilities on General Dynamics and Walmart 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 General Dynamics with a short position of Walmart. Check out your portfolio center. Please also check ongoing floating volatility patterns of General Dynamics and Walmart.
Diversification Opportunities for General Dynamics and Walmart
-0.71 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between General and Walmart is -0.71. Overlapping area represents the amount of risk that can be diversified away by holding General Dynamics Corp and Walmart in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Walmart and General Dynamics 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 General Dynamics Corp are associated (or correlated) with Walmart. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Walmart has no effect on the direction of General Dynamics i.e., General Dynamics and Walmart go up and down completely randomly.
Pair Corralation between General Dynamics and Walmart
If you would invest 26,405 in General Dynamics Corp on October 25, 2024 and sell it today you would earn a total of 845.00 from holding General Dynamics Corp or generate 3.2% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 95.0% |
| Values | Daily Returns |
General Dynamics Corp vs. Walmart
Performance |
| Timeline |
| General Dynamics Corp |
| Walmart |
General Dynamics and Walmart Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with General Dynamics and Walmart
The main advantage of trading using opposite General Dynamics and Walmart positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if General Dynamics position performs unexpectedly, Walmart 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 Walmart will offset losses from the drop in Walmart's long position.| General Dynamics vs. Atalaya Mining | General Dynamics vs. Anglo Asian Mining | General Dynamics vs. Blackrock World Mining | General Dynamics vs. Coeur Mining |
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Check out your portfolio center.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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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