Correlation Between Walker Dunlop and Copa Holdings
Can any of the company-specific risk be diversified away by investing in both Walker Dunlop and Copa Holdings 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 Copa Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Walker Dunlop and Copa Holdings SA, you can compare the effects of market volatilities on Walker Dunlop and Copa Holdings 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 Copa Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Walker Dunlop and Copa Holdings.
Diversification Opportunities for Walker Dunlop and Copa Holdings
0.37 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Walker and Copa is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding Walker Dunlop and Copa Holdings SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Copa Holdings SA 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 Copa Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Copa Holdings SA has no effect on the direction of Walker Dunlop i.e., Walker Dunlop and Copa Holdings go up and down completely randomly.
Pair Corralation between Walker Dunlop and Copa Holdings
Allowing for the 90-day total investment horizon Walker Dunlop is expected to generate 0.9 times more return on investment than Copa Holdings. However, Walker Dunlop is 1.11 times less risky than Copa Holdings. It trades about 0.08 of its potential returns per unit of risk. Copa Holdings SA is currently generating about 0.02 per unit of risk. If you would invest 9,351 in Walker Dunlop on September 1, 2024 and sell it today you would earn a total of 1,667 from holding Walker Dunlop or generate 17.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 96.18% |
| Values | Daily Returns |
Walker Dunlop vs. Copa Holdings SA
Performance |
| Timeline |
| Walker Dunlop |
| Copa Holdings SA |
Walker Dunlop and Copa Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Walker Dunlop and Copa Holdings
The main advantage of trading using opposite Walker Dunlop and Copa Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Walker Dunlop position performs unexpectedly, Copa Holdings 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 Copa Holdings will offset losses from the drop in Copa Holdings' 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 |
| Copa Holdings vs. Southwest Airlines Co | Copa Holdings vs. Superior Plus Corp | Copa Holdings vs. NMI Holdings | Copa Holdings vs. Origin Agritech |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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