Correlation Between Walker Dunlop and Cafe24 Corp
Can any of the company-specific risk be diversified away by investing in both Walker Dunlop and Cafe24 Corp 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 Walker Dunlop and Cafe24 Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Walker Dunlop and Cafe24 Corp, you can compare the effects of market volatilities on Walker Dunlop and Cafe24 Corp 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 Walker Dunlop with a short position of Cafe24 Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Walker Dunlop and Cafe24 Corp.
Diversification Opportunities for Walker Dunlop and Cafe24 Corp
-0.69 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Walker and Cafe24 is -0.69. Overlapping area represents the amount of risk that can be diversified away by holding Walker Dunlop and Cafe24 Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cafe24 Corp and Walker Dunlop 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 Walker Dunlop are associated (or correlated) with Cafe24 Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cafe24 Corp has no effect on the direction of Walker Dunlop i.e., Walker Dunlop and Cafe24 Corp go up and down completely randomly.
Pair Corralation between Walker Dunlop and Cafe24 Corp
Allowing for the 90-day total investment horizon Walker Dunlop is expected to under-perform the Cafe24 Corp. But the stock apears to be less risky and, when comparing its historical volatility, Walker Dunlop is 1.53 times less risky than Cafe24 Corp. The stock trades about -0.07 of its potential returns per unit of risk. The Cafe24 Corp is currently generating about 0.19 of returns per unit of risk over similar time horizon. If you would invest 3,445,000 in Cafe24 Corp on October 26, 2024 and sell it today you would earn a total of 445,000 from holding Cafe24 Corp or generate 12.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 95.0% |
| Values | Daily Returns |
Walker Dunlop vs. Cafe24 Corp
Performance |
| Timeline |
| Walker Dunlop |
| Cafe24 Corp |
Walker Dunlop and Cafe24 Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Walker Dunlop and Cafe24 Corp
The main advantage of trading using opposite Walker Dunlop and Cafe24 Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Walker Dunlop position performs unexpectedly, Cafe24 Corp 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 Cafe24 Corp will offset losses from the drop in Cafe24 Corp's long position.| Walker Dunlop vs. Mr Cooper Group | Walker Dunlop vs. Velocity Financial Llc | Walker Dunlop vs. Security National Financial | Walker Dunlop vs. Encore Capital Group |
| Cafe24 Corp vs. Daesung Hi Tech Co | Cafe24 Corp vs. ChipsMedia | Cafe24 Corp vs. LG Display Co | Cafe24 Corp vs. SAMG Entertainment Co |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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