Correlation Between Walker Dunlop and 88 Energy
Can any of the company-specific risk be diversified away by investing in both Walker Dunlop and 88 Energy 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 88 Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Walker Dunlop and 88 Energy, you can compare the effects of market volatilities on Walker Dunlop and 88 Energy 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 88 Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Walker Dunlop and 88 Energy.
Diversification Opportunities for Walker Dunlop and 88 Energy
-0.1 | Correlation Coefficient |
Good diversification
The 3 months correlation between Walker and 88E is -0.1. Overlapping area represents the amount of risk that can be diversified away by holding Walker Dunlop and 88 Energy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on 88 Energy 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 88 Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of 88 Energy has no effect on the direction of Walker Dunlop i.e., Walker Dunlop and 88 Energy go up and down completely randomly.
Pair Corralation between Walker Dunlop and 88 Energy
Allowing for the 90-day total investment horizon Walker Dunlop is expected to generate 38.33 times less return on investment than 88 Energy. But when comparing it to its historical volatility, Walker Dunlop is 8.81 times less risky than 88 Energy. It trades about 0.02 of its potential returns per unit of risk. 88 Energy is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 1.09 in 88 Energy on November 5, 2024 and sell it today you would lose (0.89) from holding 88 Energy or give up 81.65% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.0% |
| Values | Daily Returns |
Walker Dunlop vs. 88 Energy
Performance |
| Timeline |
| Walker Dunlop |
| 88 Energy |
Walker Dunlop and 88 Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Walker Dunlop and 88 Energy
The main advantage of trading using opposite Walker Dunlop and 88 Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Walker Dunlop position performs unexpectedly, 88 Energy 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 88 Energy will offset losses from the drop in 88 Energy'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 |
| 88 Energy vs. AiMedia Technologies | 88 Energy vs. Ainsworth Game Technology | 88 Energy vs. oOhMedia | 88 Energy vs. Lendlease Group |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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