Correlation Between GameStop Corp and Walker Dunlop
Can any of the company-specific risk be diversified away by investing in both GameStop Corp and Walker Dunlop 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 GameStop Corp and Walker Dunlop into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GameStop Corp and Walker Dunlop, you can compare the effects of market volatilities on GameStop Corp and Walker Dunlop 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 GameStop Corp with a short position of Walker Dunlop. Check out your portfolio center. Please also check ongoing floating volatility patterns of GameStop Corp and Walker Dunlop.
Diversification Opportunities for GameStop Corp and Walker Dunlop
-0.18 | Correlation Coefficient |
Good diversification
The 3 months correlation between GameStop and Walker is -0.18. Overlapping area represents the amount of risk that can be diversified away by holding GameStop Corp and Walker Dunlop in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Walker Dunlop and GameStop Corp 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 GameStop Corp are associated (or correlated) with Walker Dunlop. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Walker Dunlop has no effect on the direction of GameStop Corp i.e., GameStop Corp and Walker Dunlop go up and down completely randomly.
Pair Corralation between GameStop Corp and Walker Dunlop
Assuming the 90 days trading horizon GameStop Corp is expected to under-perform the Walker Dunlop. In addition to that, GameStop Corp is 1.27 times more volatile than Walker Dunlop. It trades about -0.31 of its total potential returns per unit of risk. Walker Dunlop is currently generating about 0.01 per unit of volatility. If you would invest 9,300 in Walker Dunlop on November 7, 2024 and sell it today you would earn a total of 0.00 from holding Walker Dunlop or generate 0.0% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
GameStop Corp vs. Walker Dunlop
Performance |
Timeline |
GameStop Corp |
Walker Dunlop |
GameStop Corp and Walker Dunlop Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with GameStop Corp and Walker Dunlop
The main advantage of trading using opposite GameStop Corp and Walker Dunlop positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GameStop Corp position performs unexpectedly, Walker Dunlop 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 Walker Dunlop will offset losses from the drop in Walker Dunlop's long position.GameStop Corp vs. ATRESMEDIA | GameStop Corp vs. International Consolidated Airlines | GameStop Corp vs. Tencent Music Entertainment | GameStop Corp vs. PENN Entertainment |
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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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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