Correlation Between MT Bank and Walmart
Can any of the company-specific risk be diversified away by investing in both MT Bank 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 MT Bank and Walmart into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MT Bank Corp and Walmart, you can compare the effects of market volatilities on MT Bank 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 MT Bank with a short position of Walmart. Check out your portfolio center. Please also check ongoing floating volatility patterns of MT Bank and Walmart.
Diversification Opportunities for MT Bank and Walmart
Very good diversification
The 3 months correlation between 0JW2 and Walmart is -0.28. Overlapping area represents the amount of risk that can be diversified away by holding MT Bank Corp and Walmart in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Walmart and MT Bank 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 MT Bank 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 MT Bank i.e., MT Bank and Walmart go up and down completely randomly.
Pair Corralation between MT Bank and Walmart
Assuming the 90 days trading horizon MT Bank Corp is expected to under-perform the Walmart. In addition to that, MT Bank is 18.77 times more volatile than Walmart. It trades about -0.29 of its total potential returns per unit of risk. Walmart is currently generating about 0.23 per unit of volatility. If you would invest 5,939 in Walmart on October 11, 2024 and sell it today you would earn a total of 21.00 from holding Walmart or generate 0.35% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
MT Bank Corp vs. Walmart
Performance |
| Timeline |
| MT Bank Corp |
| Walmart |
MT Bank and Walmart Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MT Bank and Walmart
The main advantage of trading using opposite MT Bank and Walmart positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MT Bank 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.| MT Bank vs. Vulcan Materials Co | MT Bank vs. Chrysalis Investments | MT Bank vs. International Biotechnology Trust | MT Bank vs. SBM Offshore NV |
| Walmart vs. MT Bank Corp | Walmart vs. Rosslyn Data Technologies | Walmart vs. Moneta Money Bank | Walmart vs. Bloomsbury Publishing Plc |
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 CEOs Directory module to screen CEOs from public companies around the world.
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