Correlation Between Walker Dunlop and Bayview Acquisition
Can any of the company-specific risk be diversified away by investing in both Walker Dunlop and Bayview Acquisition 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 Bayview Acquisition into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Walker Dunlop and Bayview Acquisition Corp, you can compare the effects of market volatilities on Walker Dunlop and Bayview Acquisition 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 Bayview Acquisition. Check out your portfolio center. Please also check ongoing floating volatility patterns of Walker Dunlop and Bayview Acquisition.
Diversification Opportunities for Walker Dunlop and Bayview Acquisition
0.72 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Walker and Bayview is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding Walker Dunlop and Bayview Acquisition Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bayview Acquisition 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 Bayview Acquisition. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bayview Acquisition Corp has no effect on the direction of Walker Dunlop i.e., Walker Dunlop and Bayview Acquisition go up and down completely randomly.
Pair Corralation between Walker Dunlop and Bayview Acquisition
Allowing for the 90-day total investment horizon Walker Dunlop is expected to generate 2.16 times more return on investment than Bayview Acquisition. However, Walker Dunlop is 2.16 times more volatile than Bayview Acquisition Corp. It trades about 0.04 of its potential returns per unit of risk. Bayview Acquisition Corp is currently generating about 0.04 per unit of risk. If you would invest 8,063 in Walker Dunlop on August 26, 2024 and sell it today you would earn a total of 2,786 from holding Walker Dunlop or generate 34.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 48.09% |
| Values | Daily Returns |
Walker Dunlop vs. Bayview Acquisition Corp
Performance |
| Timeline |
| Walker Dunlop |
| Bayview Acquisition Corp |
Walker Dunlop and Bayview Acquisition Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Walker Dunlop and Bayview Acquisition
The main advantage of trading using opposite Walker Dunlop and Bayview Acquisition positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Walker Dunlop position performs unexpectedly, Bayview Acquisition 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 Bayview Acquisition will offset losses from the drop in Bayview Acquisition'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 |
| Bayview Acquisition vs. Voyager Acquisition Corp | Bayview Acquisition vs. YHN Acquisition I | Bayview Acquisition vs. Vine Hill Capital | Bayview Acquisition vs. DP Cap Acquisition |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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