Correlation Between Bloomsbury Publishing and Walmart
Can any of the company-specific risk be diversified away by investing in both Bloomsbury Publishing 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 Bloomsbury Publishing and Walmart into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bloomsbury Publishing Plc and Walmart, you can compare the effects of market volatilities on Bloomsbury Publishing 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 Bloomsbury Publishing with a short position of Walmart. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bloomsbury Publishing and Walmart.
Diversification Opportunities for Bloomsbury Publishing and Walmart
-0.09 | Correlation Coefficient |
Good diversification
The 3 months correlation between Bloomsbury and Walmart is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding Bloomsbury Publishing Plc and Walmart in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Walmart and Bloomsbury Publishing 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 Bloomsbury Publishing Plc 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 Bloomsbury Publishing i.e., Bloomsbury Publishing and Walmart go up and down completely randomly.
Pair Corralation between Bloomsbury Publishing and Walmart
Assuming the 90 days trading horizon Bloomsbury Publishing Plc is expected to under-perform the Walmart. In addition to that, Bloomsbury Publishing is 20.68 times more volatile than Walmart. It trades about -0.14 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 |
Bloomsbury Publishing Plc vs. Walmart
Performance |
| Timeline |
| Bloomsbury Publishing Plc |
| Walmart |
Bloomsbury Publishing and Walmart Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bloomsbury Publishing and Walmart
The main advantage of trading using opposite Bloomsbury Publishing and Walmart positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bloomsbury Publishing 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.| Bloomsbury Publishing vs. Indutrade AB | Bloomsbury Publishing vs. BE Semiconductor Industries | Bloomsbury Publishing vs. Nordic Semiconductor ASA | Bloomsbury Publishing vs. Baker Steel Resources |
| 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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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