Correlation Between Walker Dunlop and Capital Financial
Can any of the company-specific risk be diversified away by investing in both Walker Dunlop and Capital Financial 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 Capital Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Walker Dunlop and Capital Financial Indonesia, you can compare the effects of market volatilities on Walker Dunlop and Capital Financial 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 Capital Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Walker Dunlop and Capital Financial.
Diversification Opportunities for Walker Dunlop and Capital Financial
-0.09 | Correlation Coefficient |
Good diversification
The 3 months correlation between Walker and Capital is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding Walker Dunlop and Capital Financial Indonesia in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Capital Financial 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 Capital Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Capital Financial has no effect on the direction of Walker Dunlop i.e., Walker Dunlop and Capital Financial go up and down completely randomly.
Pair Corralation between Walker Dunlop and Capital Financial
Allowing for the 90-day total investment horizon Walker Dunlop is expected to generate 0.91 times more return on investment than Capital Financial. However, Walker Dunlop is 1.1 times less risky than Capital Financial. It trades about 0.04 of its potential returns per unit of risk. Capital Financial Indonesia is currently generating about -0.02 per unit of risk. If you would invest 8,063 in Walker Dunlop on August 25, 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 Against |
| Strength | Insignificant |
| Accuracy | 95.57% |
| Values | Daily Returns |
Walker Dunlop vs. Capital Financial Indonesia
Performance |
| Timeline |
| Walker Dunlop |
| Capital Financial |
Walker Dunlop and Capital Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Walker Dunlop and Capital Financial
The main advantage of trading using opposite Walker Dunlop and Capital Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Walker Dunlop position performs unexpectedly, Capital Financial 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 Capital Financial will offset losses from the drop in Capital Financial'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 |
| Capital Financial vs. Paninvest Tbk | Capital Financial vs. Maskapai Reasuransi Indonesia | Capital Financial vs. Panin Sekuritas Tbk | Capital Financial vs. Wahana Ottomitra Multiartha |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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