Correlation Between Walmart and Geely Automobile
Can any of the company-specific risk be diversified away by investing in both Walmart and Geely Automobile 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 Geely Automobile into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Walmart and Geely Automobile Holdings, you can compare the effects of market volatilities on Walmart and Geely Automobile 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 Geely Automobile. Check out your portfolio center. Please also check ongoing floating volatility patterns of Walmart and Geely Automobile.
Diversification Opportunities for Walmart and Geely Automobile
0.14 | Correlation Coefficient |
Average diversification
The 3 months correlation between Walmart and Geely is 0.14. Overlapping area represents the amount of risk that can be diversified away by holding Walmart and Geely Automobile Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Geely Automobile Holdings 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 Geely Automobile. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Geely Automobile Holdings has no effect on the direction of Walmart i.e., Walmart and Geely Automobile go up and down completely randomly.
Pair Corralation between Walmart and Geely Automobile
If you would invest 1,500 in Geely Automobile Holdings on October 30, 2024 and sell it today you would earn a total of 0.00 from holding Geely Automobile Holdings or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Walmart vs. Geely Automobile Holdings
Performance |
| Timeline |
| Walmart |
| Geely Automobile Holdings |
Walmart and Geely Automobile Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Walmart and Geely Automobile
The main advantage of trading using opposite Walmart and Geely Automobile positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Walmart position performs unexpectedly, Geely Automobile 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 Geely Automobile will offset losses from the drop in Geely Automobile's long position.| Walmart vs. LBG Media PLC | Walmart vs. Centaur Media | Walmart vs. Intermediate Capital Group | Walmart vs. Seche Environnement SA |
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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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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