Correlation Between Journey Energy and Walmart
Can any of the company-specific risk be diversified away by investing in both Journey Energy 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 Journey Energy and Walmart into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Journey Energy and Walmart Inc CDR, you can compare the effects of market volatilities on Journey Energy 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 Journey Energy with a short position of Walmart. Check out your portfolio center. Please also check ongoing floating volatility patterns of Journey Energy and Walmart.
Diversification Opportunities for Journey Energy and Walmart
-0.63 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Journey and Walmart is -0.63. Overlapping area represents the amount of risk that can be diversified away by holding Journey Energy and Walmart Inc CDR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Walmart Inc CDR and Journey Energy 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 Journey Energy 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 Inc CDR has no effect on the direction of Journey Energy i.e., Journey Energy and Walmart go up and down completely randomly.
Pair Corralation between Journey Energy and Walmart
Assuming the 90 days trading horizon Journey Energy is expected to under-perform the Walmart. In addition to that, Journey Energy is 2.32 times more volatile than Walmart Inc CDR. It trades about -0.08 of its total potential returns per unit of risk. Walmart Inc CDR is currently generating about 0.4 per unit of volatility. If you would invest 3,605 in Walmart Inc CDR on August 29, 2024 and sell it today you would earn a total of 391.00 from holding Walmart Inc CDR or generate 10.85% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Journey Energy vs. Walmart Inc CDR
Performance |
| Timeline |
| Journey Energy |
| Walmart Inc CDR |
Journey Energy and Walmart Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Journey Energy and Walmart
The main advantage of trading using opposite Journey Energy and Walmart positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Journey Energy 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.| Journey Energy vs. Canadian Natural Resources | Journey Energy vs. Suncor Energy | Journey Energy vs. iShares Canadian HYBrid | Journey Energy vs. Altagas Cum Red |
| Walmart vs. Nicola Mining | Walmart vs. Northstar Clean Technologies | Walmart vs. North American Construction | Walmart vs. Air Canada |
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 Anywhere module to track or share privately all of your investments from the convenience of any device.
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