Correlation Between Walker Dunlop and BZAM
Can any of the company-specific risk be diversified away by investing in both Walker Dunlop and BZAM 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 BZAM into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Walker Dunlop and BZAM, you can compare the effects of market volatilities on Walker Dunlop and BZAM 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 BZAM. Check out your portfolio center. Please also check ongoing floating volatility patterns of Walker Dunlop and BZAM.
Diversification Opportunities for Walker Dunlop and BZAM
-0.36 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Walker and BZAM is -0.36. Overlapping area represents the amount of risk that can be diversified away by holding Walker Dunlop and BZAM in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BZAM 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 BZAM. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BZAM has no effect on the direction of Walker Dunlop i.e., Walker Dunlop and BZAM go up and down completely randomly.
Pair Corralation between Walker Dunlop and BZAM
Allowing for the 90-day total investment horizon Walker Dunlop is expected to generate 0.07 times more return on investment than BZAM. However, Walker Dunlop is 14.34 times less risky than BZAM. It trades about 0.05 of its potential returns per unit of risk. BZAM is currently generating about -0.22 per unit of risk. If you would invest 10,870 in Walker Dunlop on September 1, 2024 and sell it today you would earn a total of 148.00 from holding Walker Dunlop or generate 1.36% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.24% |
| Values | Daily Returns |
Walker Dunlop vs. BZAM
Performance |
| Timeline |
| Walker Dunlop |
| BZAM |
Walker Dunlop and BZAM Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Walker Dunlop and BZAM
The main advantage of trading using opposite Walker Dunlop and BZAM positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Walker Dunlop position performs unexpectedly, BZAM 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 BZAM will offset losses from the drop in BZAM'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 |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
Other Complementary Tools
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
| USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA | |
| Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios |