Correlation Between Interpublic Group and Walmart
Can any of the company-specific risk be diversified away by investing in both Interpublic Group 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 Interpublic Group and Walmart into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Interpublic Group of and Walmart, you can compare the effects of market volatilities on Interpublic Group 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 Interpublic Group with a short position of Walmart. Check out your portfolio center. Please also check ongoing floating volatility patterns of Interpublic Group and Walmart.
Diversification Opportunities for Interpublic Group and Walmart
-0.56 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Interpublic and Walmart is -0.56. Overlapping area represents the amount of risk that can be diversified away by holding Interpublic Group of and Walmart in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Walmart and Interpublic Group 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 Interpublic Group of 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 Interpublic Group i.e., Interpublic Group and Walmart go up and down completely randomly.
Pair Corralation between Interpublic Group and Walmart
If you would invest 5,960 in Walmart on October 25, 2024 and sell it today you would earn a total of 0.00 from holding Walmart or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.0% |
| Values | Daily Returns |
Interpublic Group of vs. Walmart
Performance |
| Timeline |
| Interpublic Group |
| Walmart |
Interpublic Group and Walmart Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Interpublic Group and Walmart
The main advantage of trading using opposite Interpublic Group and Walmart positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Interpublic Group 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.| Interpublic Group vs. Norwegian Air Shuttle | Interpublic Group vs. Ryanair Holdings plc | Interpublic Group vs. Fair Oaks Income | Interpublic Group vs. Sovereign Metals |
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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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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