Correlation Between Walker Dunlop and Bath Body
Can any of the company-specific risk be diversified away by investing in both Walker Dunlop and Bath Body 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 Bath Body into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Walker Dunlop and Bath Body Works, you can compare the effects of market volatilities on Walker Dunlop and Bath Body 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 Bath Body. Check out your portfolio center. Please also check ongoing floating volatility patterns of Walker Dunlop and Bath Body.
Diversification Opportunities for Walker Dunlop and Bath Body
-0.55 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Walker and Bath is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding Walker Dunlop and Bath Body Works in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bath Body Works 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 Bath Body. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bath Body Works has no effect on the direction of Walker Dunlop i.e., Walker Dunlop and Bath Body go up and down completely randomly.
Pair Corralation between Walker Dunlop and Bath Body
Allowing for the 90-day total investment horizon Walker Dunlop is expected to generate 1.87 times more return on investment than Bath Body. However, Walker Dunlop is 1.87 times more volatile than Bath Body Works. It trades about 0.0 of its potential returns per unit of risk. Bath Body Works is currently generating about -0.11 per unit of risk. If you would invest 9,569 in Walker Dunlop on October 29, 2024 and sell it today you would lose (59.00) from holding Walker Dunlop or give up 0.62% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 90.0% |
| Values | Daily Returns |
Walker Dunlop vs. Bath Body Works
Performance |
| Timeline |
| Walker Dunlop |
| Bath Body Works |
Walker Dunlop and Bath Body Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Walker Dunlop and Bath Body
The main advantage of trading using opposite Walker Dunlop and Bath Body positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Walker Dunlop position performs unexpectedly, Bath Body 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 Bath Body will offset losses from the drop in Bath Body'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 |
| Bath Body vs. Gaztransport et Technigaz | Bath Body vs. Sabre Insurance Group | Bath Body vs. Clean Power Hydrogen | Bath Body vs. Morgan Advanced Materials |
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 Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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