Correlation Between Walker Dunlop and New Advanced
Can any of the company-specific risk be diversified away by investing in both Walker Dunlop and New Advanced 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 New Advanced into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Walker Dunlop and New Advanced Electronics, you can compare the effects of market volatilities on Walker Dunlop and New Advanced 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 New Advanced. Check out your portfolio center. Please also check ongoing floating volatility patterns of Walker Dunlop and New Advanced.
Diversification Opportunities for Walker Dunlop and New Advanced
-0.2 | Correlation Coefficient |
Good diversification
The 3 months correlation between Walker and New is -0.2. Overlapping area represents the amount of risk that can be diversified away by holding Walker Dunlop and New Advanced Electronics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on New Advanced Electronics 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 New Advanced. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of New Advanced Electronics has no effect on the direction of Walker Dunlop i.e., Walker Dunlop and New Advanced go up and down completely randomly.
Pair Corralation between Walker Dunlop and New Advanced
Allowing for the 90-day total investment horizon Walker Dunlop is expected to under-perform the New Advanced. But the stock apears to be less risky and, when comparing its historical volatility, Walker Dunlop is 1.2 times less risky than New Advanced. The stock trades about -0.16 of its potential returns per unit of risk. The New Advanced Electronics is currently generating about 0.16 of returns per unit of risk over similar time horizon. If you would invest 5,350 in New Advanced Electronics on November 18, 2024 and sell it today you would earn a total of 1,230 from holding New Advanced Electronics or generate 22.99% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.08% |
| Values | Daily Returns |
Walker Dunlop vs. New Advanced Electronics
Performance |
| Timeline |
| Walker Dunlop |
| New Advanced Electronics |
Walker Dunlop and New Advanced Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Walker Dunlop and New Advanced
The main advantage of trading using opposite Walker Dunlop and New Advanced positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Walker Dunlop position performs unexpectedly, New Advanced 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 New Advanced will offset losses from the drop in New Advanced'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 |
| New Advanced vs. Forest Water Environmental | New Advanced vs. Chia Yi Steel | New Advanced vs. Hi Lai Foods Co | New Advanced vs. TMP Steel |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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